Silver Price Analysis: XAG/USD eyes a break above $27 amid rectangle breakout

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  • Silver looks to extend the bullish momentum, tracking Gold.
  • Rectangle pattern breakout spotted on the hourly sticks.  
  • A pullback cannot be ruled out before the uptrend resumes.

Silver (XAG/USD) is on a roll higher and tests fresh all-time highs, taking cues from its close peer, gold.

The spot sits at record highs above $26.75 and looks to break above the $27 barrier amid a bullish technical set up.

From a short-term technical perspective, the white metal remains exposed to further upside risks, given the rectangle pattern breakout spotted on the hourly chart in early Europe.

The technical breakout calls for a test of the pattern target at $27.27 before which the bulls could face stiff resistance at $27.00 (round figure).

The hourly Relative Strength Index (RSI) holds steady in the overbought territory. Therefore, temporary pullbacks cannot be ruled before the bullish spin resumes.

The corrective declines could meet strong demand at the horizontal pattern resistance-turned-support at $26.32, below which the upward-sloping 21-hourly Simple Moving Average (HMA) at $25.92 could come into play.

All in all, the path of least resistance is to the upside in XAG/USD.

Silver: XAG/USD hourly chart

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