Silver Price Analysis: XAG is flirting with $27 but the technical structure still stands

• Silver is trading 0.90% higher as the US dollar pulls back on Wednesday.
• This is still a consolidation zone until some key levels get broken.

Silver 4-hour chart

Silver has pushed higher on Wednesday and this is mainly due to the fact that the US dollar has retraced following some recent strength. It is hard to say if the greenback (US dollar) has moved back to trade once again in a downtrend or if the underlying trend will change. Silver is more of an industrial metal than gold so its links with economic performance are stronger and this could be telling in the coming months. 

Looking at the price chart, silver is still in a firm consolidation phase. A brake of the pattern to the upside could mean that high on the chart may be tested. The red support line at USD 26 per troy ounce has been performing well recently. It seems the bulls are waiting to hover up more of the metal as soon as the price gets anywhere near the level.

The indicators there seems to be more bullishness. The RSI has a bullish divergence playing out at the moment and has pushed slightly higher. The MACD is also looking more bullish as the histogram is in the green but the signal lines are still under the mid-level.

Overall this is still an uptrend but the market has reached an equilibrium due to the recent USD strength. Longer-term I think the market needs to see what the Fed do at the next FOMC meeting before deciding if the uptrend will continue. A break of the pattern could be a clue to positioning. 

Additional levels