Silver Price Forecast: XAG/USD retreats further from one-month top, downside seems limited

• Silver attracts some sellers and drops to a fresh weekly low on Wednesday.
• Any further slide could be seen as a buying opportunity and remain limited.
• The $29.40 confluence resistance breakpoint might now act as a strong base. 

Silver (XAG/USD) drifts lower during the Asian session on Wednesday and moves away from a one-month peak, around the $31.10 region touched earlier this week. The white metal currently trades around mid-$30.00s, or the weekly low and down nearly 0.70% for the day, though the technical setup supports prospects for the emergence of some dip-buying. 

The recent breakout through a short-term descending trend-line resistance, around the $29.40 area, which coincided with the 100-day Simple Moving Average (SMA) validates the near-term positive outlook. Moreover, oscillators on the daily chart are holding in positive territory and are still far from being in the overbought zone, suggesting that the path of least resistance for the XAG/USD is to the upside. 

From current levels, any subsequent decline is likely to attract fresh buyers near the $30.00 psychological mark. This should help limit the downside near the $29.40 confluence resistance breakpoint, now turned support. The latter should act as a pivotal point, which if broken could drag the XAG/USD below the $29.00 round figure, towards the $28.45-$28.40 intermediate support en route to the $28.00 mark.

On the flip side, the $30.80 region now seems to act as an immediate hurdle ahead of the $31.00 mark, above which the white metal could prolong its appreciating move. The XAG/USD might then climb to the $31.45 region and retest the July swing high, around the $31.75 zone, before aiming to reclaim the $32.00 round-figure mark and challenge a one-decade high, around mid-$32.00s touched in May.

Silver daily chart