Silver (XAG/USD) is trading in an up leg towards the top of a broad range that stretches from the $26s to the $30s.
Silver is bullish over the short-term and given it is a principle of technical analysis that “the trend is your friend” more upside is favored.
Silver will probably continue higher towards the range high at roughly $30.90 before encountering resistance from the ceiling.
Silver is overbought, however, according to the Relative Strength Index (RSI) momentum indicator. This advises traders not to add to their long positions. If RSI moves back out of the overbought zone it will provide a sell signal and indicate a probable correction is evolving.
Such a correction might find support either in the $29.60s (August 28 high) or, if deeper, at the $29.18 former mini-range high.
Given the short-term trend is bullish, the correction is likely to eventually run out of steam, however, and the uptrend to resume, pushing Silver to new heights.