When to Buy Palladium? Some Key Moves to Watch

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Palladium prices experienced an 11 percent increase since the start of February. Supply concerns due to the South African platinum miners’ strike might have helped move prices higher. The move seems to have great momentum, but how much higher can prices go?

Palladium CME spot price since 2013 chart

Palladium CME spot price since 2013.

The precious and platinum-group metal (PGM) has been trading sideways since the end of 2012. During the month of March, prices are clearly confronting a resistance level that hasn’t been exceeded since 2011. A metal can trade sideways for long periods of time. When the price finally breaks through previous levels, this should be taken as a bullish signal as buying pressure has to be strong to push prices above those levels and a new upward move can start.

What This Means For Metal Buyers

If prices keep going up, we would recommend palladium buyers to start hedging for the balance of 2014.

Prices going above $800 per ounce might be a good time to start taking positions. Until that happens, we would advise buyers not to panic because prices could actually bounce down as they meet resistance levels.

Read more from Raul de Frutos.

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