Commodities

Technical Analysis – Palladium futures halt bullish run at fresh record high; resistance line in focus

Posted on December 19, 2019 at 11:29 am GMT

Christina Parthenidou, XM Investment Research Desk

Palladium futures has been in the green every single day since mid-November, extending the row of record highs to 1,972 on Tuesday before retracing marginally lower.

The short-term risk is tilted to the downside as the RSI has reached its previous peaks in the overbought area and is now following a downward direction, while the MACD has also found resistance in a familiar region and is easing momentum towards its red signal line.

Trend signals, however, remain positive as the price keeps printing higher highs and higher lows and is above the Ichimoku cloud and its simple moving averages (SMA) which are all sloping upwards.

Traders will be eagerly waiting to see if the long-term resistance line drawn from the September 2017 peak of 994.80, currently near 1,841, and the 20-day simple moving average (SMA) acts as support to potential downside corrections. If not and the selling pressure extends below the previous high of 1,796 and the 23.6% Fibonacci of the 1,254-1,972 upleg, then the 38.2% Fibonacci of 1,698 could next take control before all attention shifts to the 1,655 barrier and the ascending trendline that joins all the lows from the 2018 bottom.

Otherwise, an upside reversal will likely challenge the 1,972 top, where any successful violation may search fresh all-time highs probably somewhere near 2,042 and then close to the 2,100 psychological level.

Summarizing, palladium futures may trade at a softer pace in the short-term and it would be interesting to see if the next turning point will happen near the resistance line.

commodities Palladium Futures

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