• Silver meets with a fresh supply on Tuesday and stalls a two-day-old recovery from the 100-DMA.
• The setup seems tilted in favour of bulls and supports prospects for the emergence of dip-buying.
• A convincing break below $24.00 will negate the positive bias and pave the way for deeper losses.

Silver comes under some renewed selling pressure on Tuesday and extends its steady intraday descent through the early part of the European session. The white metal currently trades around the $23.55 area, down nearly 1% for the day, and for now, seems to have stalled a two-day-old recovery trend from the $24.00 mark, or a two-week low touched last Thursday.

The aforementioned handle coincides with a technically significant 100-day Simple Moving Average (SMA) and should continue to protect the immediate downside. A convincing break below will be seen as a fresh trigger for bearish traders and set the stage for deeper losses. The XAG/USD might then turn vulnerable and accelerate the downfall towards testing the next relevant support near the $23.20-$23.15 area.

This is closely followed by the very important 200-day SMA support near the $23.00 mark. Some follow-through selling will make the XAG/USD vulnerable to accelerate the fall towards challenging the multi-month low, around the $22.15-$22.10 area touched in June.

That said, technical indicators on the daily chart - though have been losing traction - as still holding in the positive territory. This, in turn, favours bullish traders and supports prospects for the emergence of some dip-buying at lower levels. However, it will still be prudent to wait for a sustained strength beyond the daily top, around the $24.75 region, before positioning for a move towards the $25.00 psychological mark.

The next relevant hurdle is pegged near the monthly peak, around the $25.25 zone, which if cleared will negate any negative outlook. Silver might then aim to surpass the $25.50-$25.55 intermediate hurdle and reclaim the $26.00 mark before climbing further to the YTD peak, around the $26.10-$26.15 area touched in May.

Silver daily chart

Key levels to watch