Silver Price Analysis: Struggles to gather upside traction despite diamond breakout

• Silver struggles to break above $17.50 despite the bullish 4-hour chart. 
• A deeper decline could be seen if the diamond breakout seen on the 4-hour chart fails. 

Silver is currently trading near $17.41 per ounce, representing a 0.21% gain on the day, having faced rejection near $17.50 on Thursday. 

The metal witnessed a diamond pattern breakout on the 4-hour chart on Thursday. The pattern indicates that the rally from lows near $15.50 has resumed. So far, however, that has failed to invite a stronger chart driven buying. 

The 4-hour chart MACD histogram has also crossed above zero, confirming a bullish reversal and validating the diamond breakout. Meanwhile, the relative strength index has violated a descending trendline. Even so, the shiny metal is hovering below $17.50. 

If prices fall back inside the diamond pattern, some buyers could exit the market, leading to a deeper price decline. Chart analysts consider failed bullish continuation patterns as powerful bearish reversal signals. 

On the downside, the lower end of the diamond pattern, currently at $16.91 is key support, which, if breached, would shift the focus to 15.84. Meanwhile, a convincing move above $17.50 would validate the bullish setup on the 4-hour chart and will likely yield a move to $18.00. 

4-hour chart

Trend: Cautiously bullish

Technical levels