Silver Price Forecast: XAG/USD trades with modest losses above $34.00, bullish bias remains

• Silver struggles to capitalize on the precious day's positive move and drifts lower on Wednesday.
• The technical setup favors bulls and supports prospects for the emergence of some dip-buying.
• A sustained break below the $33.10-$33.00 area is needed to negate the near-term positive bias.

Silver (XAG/USD) meets with a fresh supply on Wednesday and drops back closer to the $34.00 mark during the first half of the European session, reversing a part of the previous day's move up. 

From a technical perspective, the XAG/USD is holding comfortably above important daily moving averages - 50-day, 100-day and 200-day SMAs. Moreover, oscillators on the daily chart maintain their positive bias and are still away from being in the overbought territory, suggesting that the path of least resistance for the white metal remains to the upside. 

Hence, any subsequent slide is more likely to find decent support near the $33.70 horizontal zone. This is followed by last week's swing low, around the $33.10 area, which if broken decisively might shift the bias in favor of bearish traders. The XAG/USD might then accelerate the slide towards the $32.20-$32.15 intermediate support en route to the $32.00 round figure.

Some follow-through selling below the $31.70-$31.65 region could drag the XAG/USD towards the $31.00 mark. The downward trajectory could extend further towards the $30.50 area and the monthly swing low, close to the $30.00 psychological mark tested on October 8.

On the flip side, bulls might now wait for a sustained strength beyond the $34.50-$34.55 area before making a fresh attempt to conquer the $35.00 psychological mark. The subsequent move up has the potential to lift the XAG/USD further towards the October 2012 swing high, around the $35.35-$35.40 region.

Silver daily chart