Silver slips as price retreats from overbought territory on easing US-China trade talks

• Silver prices extend losses as bullish momentum remains in overbought terrain.
• US President confirms positive progress with China, which lifted Silver to multi-decade highs.
• XAG/USD price action remains above $36.00 with the Relative Strength Index (RSI) at 67.

Silver prices are easing on Wednesday, retreating from multi-year highs as bullish momentum fades and traders lock in profits. 

The metal is currently hovering near the $36.00 psychological support zone, having tested its highest levels since February 2012 earlier this week.

On Tuesday, high-level negotiations between the US and China concluded in London with a provisional framework agreement, reigniting hopes of a reset in bilateral trade cooperation.

US President Donald Trump commented on trade talks on Wednesday, stating that: "We've made real progress with China. It's about fairness, and we're close to something that could work for both countries. I won't sign anything weak."

Chinese Vice Premier He Lifeng added that "China's stance on trade issues with the US is clear and consistent. Both sides should strive to establish stable and long-term trade and economic ties."

The optimism initially supported industrial demand sentiment, helping lift Silver. However, with prices already overbought, extended gains remained limited. 

Silver prices retreat from overbought territory

Silver surged past key resistance at the October 2012 high of $35.96 but failed to sustain momentum above $36.65, forming a near-term top just below $37.49, the next major resistance level.

Immediate support is now seen at the 10-day Simple Moving Average (SMA) of $35.12, followed by the $35.00-$34.87 zone, which marks a prior breakout level and Fibonacci base.

Silver daily chart

A deeper downside could expose $34.00 and then the 50-day SMA at $33.01, while a sustained move higher would require a breakout above $37.49.

The Relative Strength Index (RSI) at 67 remains near overbought territory, indicating stretched bullish momentum and increased likelihood of further consolidation or a short-term pullback.