Silver Price Forecast: XAG/USD bulls retain control near four-month top, above $32.00 mark

• Silver consolidates near a multi-month peak touched earlier this Wednesday.
• The technical setup favors bulls and supports prospects for additional gains.
• Any corrective slide could be seen as a buying opportunity and remain limited.

Silver (XAG/USD) enters a bullish consolidation phase after touching a four-month top during the Asian session on Wednesday and currently trades around the $32.10-$32.15 region, nearly unchanged for the day. The technical setup, meanwhile, supports prospects for an extension of the recent uptrend witnessed over the past two weeks or so. 

The recent breakout through a short-term descending trend-line resistance and the overnight strong move up beyond the $31.50 supply zone was seen as a fresh trigger for bullish traders. Moreover, oscillators on the daily chart are holding comfortably in positive territory and are still away from being in the overbought zone. This, in turn, suggests that the path of least resistance for the XAG/USD is to the upside. 

From current levels, any subsequent move up is likely to confront resistance near mid-$32.00s, or a one-decade top touched in May. Some follow-through buying will reaffirm the near-term positive outlook and pave the way for a further appreciating move towards conquering the $33.00 round-figure mark for the first time since December 2012.

On the flip side, any meaningful slide could be seen as a buying opportunity near the $31.50-$31.40 region. This is followed by support near the $31.25 area and the $31.00 mark, which if broken could drag the white metal to the $30.60-$30.55 zone. The XAG/USD could extend the slide to the $30.00 psychological mark en route to the $29.70-$29.65 area, or the descending trend-line resistance breakpoint, now turned support.

The latter now coincides with the 100-day Simple Moving Average (SMA) and should act as a key pivotal point. A convincing break below the said confluence support will suggest that the XAG/USD has topped out in the near term and prompt aggressive technical selling, paving the way for a deeper corrective decline.

Silver daily chart