Silver Price Forecast: XAG/USD retreats from multi-week peak, slides below mid-$36.00s

• Silver corrects from its highest level since February 2012 set on Monday.
• A slightly overbought RSI prompts the XAG/USD bulls to lighten their bets.
• Any further slide could be seen as a buying opportunity and remain limited.

Silver (XAG/USD) sticks to modest intraday losses through the early European session on Tuesday and for now, seems to have snapped a three-day winning streak to the $37.00 neighborhood, or its highest level since February 2012. The white metal currently trades below mid-$36.00s, down 0.80% for the day.

The daily Relative Strength Index (RSI) is flashing slightly overbought conditions and prompts the XAG/USD bulls to take some profits off the table. However, the recent breakout through the previous multi-year peak and the subsequent move up favor suggests that any meaningful corrective pullback could be seen as a buying opportunity.

From current levels, the $36.00-$35.90 area could offer immediate support, below which the XAG/USD could extend the slide to the next relevant support near the $35.60 region en route to levels below the $35.00 psychological mark. The latter should act as a key pivotal point and a convincing break below would negate the constructive outlook. This, in turn, would shift the near-term bias in favor of bearish traders and pave the way for some meaningful downside.

On the flip side, bulls might now await a move beyond the $37.00 round figure before placing fresh bets and positioning for an extension of over a one-week-old uptrend. The XAG/USD might then retest the 2012 yearly swing high, around mid-$37.00s, before aiming to reclaim the $38.00 mark for the first time since September 2011.

Silver daily chart