Silver (XAG/USD) saw a sharp decline on Thursday after reaching $33.70, a seven-week high, and stabilised around $32.95 later. This reversal came as the US Dollar rebounded slightly, and the metal faced technical resistance under the $34.00 level near April’s peak.

The drop in Silver preceded the US PMI release, hinting at technical adjustments and US Dollar stabilisation after Wednesday’s breakout. Despite this dip, the overall trend maintains a positive outlook, supported by a breakout from a multi-week symmetrical triangle since May. Prices surged through the descending trendline resistance, nearing levels unseen since April.

Thursday’s decline seems like a standard breakout retest, with prices easing towards the $32.50–32.70 support zone. This zone aligns with the 21-day EMA and past resistance of the broken triangle, showing market respect and buyer control over the broader trend despite short-term setbacks.

Momentum indicators like the RSI and MACD highlight a market transition – RSI is near neutral, and MACD remains slightly positive, despite showing signs of flattening. Key support above $32.50 should sustain the bullish structure; a break below could lead to further corrections. Conversely, a rise above $33.50 may drive new purchases and test April’s highs near $34.25.

From what we’ve observed in recent sessions, Silver appears to be moving through a textbook pattern commonly seen following a breakout. After that sharp rise to $33.70 – the highest level in nearly two months – the retreat towards $32.95 wasn’t entirely unexpected. These sorts of movements often occur when traders reassess positioning, especially when prices approach a key technical ceiling like April’s highs. The US Dollar’s stabilisation, albeit modest, also contributed to this momentary drag.

The larger structure still reflects strength. The breakout from the symmetrical triangle that had been capping prices since May indicates that bulls carry firm control, and more notably, have confidence. That descending trendline was tested multiple times and finally gave way last week, which reinforces the legitimacy of the breakout. In that context, the current cooldown shouldn’t be misinterpreted—it aligns with what we’d normally see during a retest of prior resistance.

An important area now sits between $32.50 and $32.70. This zone has taken on a dual role – it’s formed by the 21-day exponential moving average and the top formation of the previous triangle. These kinds of confluences tend to act as magnet zones where price either bounces or builds momentum for the next leg. Support here suggests market participants are still willing to buy dips, but any breach might shift momentum and tempt shorter-term sellers to become more aggressive.

Indicators offer further clarity. The Relative Strength Index, hovering near neutral, doesn’t show exhaustion, which supports the idea that the trend may still have legs. The MACD, though slightly flat, is still displaying a positive differential between its signal and base lines, reinforcing that directional momentum hasn’t been lost entirely—it’s more on hold than reversed.

For those positioned defensively, watching for reactions near that support zone should be a priority. A daily close below the area wouldn’t just pull Silver lower technically—it may start to unwind a portion of the recent long positioning. On the other hand, climbing past $33.50 with volume would confirm continued buying pressure and open the door for another test of April’s $34.25 ceiling, a level that last triggered broader retracements.

In terms of action, it’s not about scrambling or shifting bias entirely. Instead, attention should stay on the way price behaves near identified turning points, both above and below. Momentum isn’t evaporating – it’s consolidating. Patience and clarity, more than anticipation, are what tend to matter in phases like this.