Silver (XAG/USD) Weekly Chart Analysis
🔻 Bearish Double Top Reversal Forming – Breakdown Below Support May Signal Deep Correction
🧭 1. Macro Overview: Market Context & Trend Insight
Silver has been in a strong bullish uptrend since early 2023, with prices climbing from the $20.00–22.00 zone all the way to a multi-year high near $34.70. This rally was driven by a mix of safe-haven demand, inflation concerns, and general weakness in the U.S. Dollar at that time.
However, in late 2024 into 2025, the momentum began stalling. Despite the strong move up, price has failed to make a higher high, showing signs of exhaustion. A large consolidation structure has formed over the past several months, and now a double top pattern is becoming more visible — a potential sign of reversal.
📐 2. Pattern Formation: Double Top Reversal
A Double Top is a classic and reliable bearish chart pattern that signals the potential end of an uptrend. It typically consists of two peaks that form near the same resistance level, separated by a dip (the neckline or support zone).
🟢 Key Elements from the Chart:
Top 1: First peak formed at ~$34.70, facing strong resistance.
Retracement: Price dropped to the neckline zone (~$28.00–29.00), finding temporary support.
Top 2: The second peak also failed to break above $34.70, confirming resistance and creating the second top.
Neckline: Multiple touches around $28.00–29.00, forming a clear horizontal support level.
This structure reflects a classic distribution phase, where large participants gradually offload long positions, and momentum starts shifting from buyers to sellers.
📉 3. Market Psychology Behind the Pattern
The psychology behind the double top is rooted in buyer exhaustion and failed breakout attempts:
First Rally: Bulls pushed price to new highs, but faced significant resistance.
Pullback: Price dropped to support, where some buyers re-entered, expecting continuation.
Second Rally Failure: The inability to break past the same resistance on the second attempt indicates fading bullish momentum.
Sellers Take Control: As buyers fail to sustain higher prices, smart money begins selling aggressively near resistance.
A break below the neckline marks the final confirmation that bears have taken control.
🎯 4. Trade Setup Strategy
📌 Entry (Trigger):
Wait for a weekly candle close below the neckline zone ($28.00–29.00).
More conservative traders can enter on the retest of this broken support as resistance — which increases the probability of success.
🎯 Take Profit (TP):
Projecting the height of the double top (from neckline to top) downward from the neckline gives a target of around $25.86.
This target aligns with previous support/demand zones and could act as a bounce area.
🛑 Stop Loss (SL):
Place SL just above the double top resistance area (~$34.70–35.00), as a break above this invalidates the pattern.
This SL placement also protects against false breakouts and volatility spikes.
⚖️ Risk to Reward:
Entry near $28.50 with a SL above $34.70 gives ~6.2 points of risk.
TP at $25.86 offers ~2.6 points of reward, making this trade offer a clean 2.5:1 or better R:R.
📊 5. Key Technical Levels Recap
Zone Price (Approx.) Function
Resistance Zone $34.70 Double Top Peaks / SL Area
Support / Neckline $28.00–29.00 Entry Trigger Area
Target Zone $25.86 TP – Measured Move Target
⏱️ 6. Timeframe & Trade Management
Timeframe: Weekly chart (swing to position trade)
Holding Period: Several weeks to a few months
Trade Management: Consider partial profit booking near $27.00, where temporary demand could appear, and trail stops if price moves favorably.
✅ 7. Summary & Professional Outlook
"The Silver (XAG/USD) weekly chart is flashing warning signals as a textbook Double Top structure forms at major resistance. A break below the neckline support zone could trigger a powerful bearish reversal, offering a high-probability short setup for swing traders. With clear invalidation levels and a favorable risk-reward profile, this setup deserves close attention going into Q2 2025."
📌 Final Notes:
This is a textbook opportunity for price action traders, technical analysts, and swing traders who follow market structure and classic patterns. Patience is key — wait for confirmation and manage risk responsibly.
🔻 Bearish Double Top Reversal Forming – Breakdown Below Support May Signal Deep Correction
🧭 1. Macro Overview: Market Context & Trend Insight
Silver has been in a strong bullish uptrend since early 2023, with prices climbing from the $20.00–22.00 zone all the way to a multi-year high near $34.70. This rally was driven by a mix of safe-haven demand, inflation concerns, and general weakness in the U.S. Dollar at that time.
However, in late 2024 into 2025, the momentum began stalling. Despite the strong move up, price has failed to make a higher high, showing signs of exhaustion. A large consolidation structure has formed over the past several months, and now a double top pattern is becoming more visible — a potential sign of reversal.
📐 2. Pattern Formation: Double Top Reversal
A Double Top is a classic and reliable bearish chart pattern that signals the potential end of an uptrend. It typically consists of two peaks that form near the same resistance level, separated by a dip (the neckline or support zone).
🟢 Key Elements from the Chart:
Top 1: First peak formed at ~$34.70, facing strong resistance.
Retracement: Price dropped to the neckline zone (~$28.00–29.00), finding temporary support.
Top 2: The second peak also failed to break above $34.70, confirming resistance and creating the second top.
Neckline: Multiple touches around $28.00–29.00, forming a clear horizontal support level.
This structure reflects a classic distribution phase, where large participants gradually offload long positions, and momentum starts shifting from buyers to sellers.
📉 3. Market Psychology Behind the Pattern
The psychology behind the double top is rooted in buyer exhaustion and failed breakout attempts:
First Rally: Bulls pushed price to new highs, but faced significant resistance.
Pullback: Price dropped to support, where some buyers re-entered, expecting continuation.
Second Rally Failure: The inability to break past the same resistance on the second attempt indicates fading bullish momentum.
Sellers Take Control: As buyers fail to sustain higher prices, smart money begins selling aggressively near resistance.
A break below the neckline marks the final confirmation that bears have taken control.
🎯 4. Trade Setup Strategy
📌 Entry (Trigger):
Wait for a weekly candle close below the neckline zone ($28.00–29.00).
More conservative traders can enter on the retest of this broken support as resistance — which increases the probability of success.
🎯 Take Profit (TP):
Projecting the height of the double top (from neckline to top) downward from the neckline gives a target of around $25.86.
This target aligns with previous support/demand zones and could act as a bounce area.
🛑 Stop Loss (SL):
Place SL just above the double top resistance area (~$34.70–35.00), as a break above this invalidates the pattern.
This SL placement also protects against false breakouts and volatility spikes.
⚖️ Risk to Reward:
Entry near $28.50 with a SL above $34.70 gives ~6.2 points of risk.
TP at $25.86 offers ~2.6 points of reward, making this trade offer a clean 2.5:1 or better R:R.
📊 5. Key Technical Levels Recap
Zone Price (Approx.) Function
Resistance Zone $34.70 Double Top Peaks / SL Area
Support / Neckline $28.00–29.00 Entry Trigger Area
Target Zone $25.86 TP – Measured Move Target
⏱️ 6. Timeframe & Trade Management
Timeframe: Weekly chart (swing to position trade)
Holding Period: Several weeks to a few months
Trade Management: Consider partial profit booking near $27.00, where temporary demand could appear, and trail stops if price moves favorably.
✅ 7. Summary & Professional Outlook
"The Silver (XAG/USD) weekly chart is flashing warning signals as a textbook Double Top structure forms at major resistance. A break below the neckline support zone could trigger a powerful bearish reversal, offering a high-probability short setup for swing traders. With clear invalidation levels and a favorable risk-reward profile, this setup deserves close attention going into Q2 2025."
📌 Final Notes:
This is a textbook opportunity for price action traders, technical analysts, and swing traders who follow market structure and classic patterns. Patience is key — wait for confirmation and manage risk responsibly.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.