Palladium, It's Going to Be Fine...

SPPP gave me a scare this week when the stock plummetted, but it seems it will likely make a full recovery and continue its bull run, at least in the short term.

The price of palladium and platinum are based on two things: supply & demand. However, it is more complicated than that. There is also market speculation on supply and demand which is often seen as directly linked to overall market performance. Overall market performance seems to dictate the swings of SPPP so much so that the price of palladium has not caught up to the demand. It's almost like a lagging indicator - like the price is stubborn to move despite the demand.

The result is that there are periods of recovery despite market movement. This is where we are now. Despite the SPX and IXIC having trouble today, palladium and platinum have regained their momentum, as investors saw this downswing as a time to buy, knowing the price was not matching supply/demand.

Historically, SPPP appears to favor the 89 EMA on the 30min candles for support in a downtrend and resistance in an uptrend, with the price frequently bouncing off this line. Similarly, spikes that surpass 80 on the RSI-21 have shattered that line of resistance on the main chart with a slow and angry tumble. This has not happened, and therefore, is new territory where the outlook is still strong.

Palladium prices went up 0.85% today, while platinum was down.

I suspect there will be a 50% recovery (seems to be typical for these types of dramatic short swings before a consolidation pattern and upswing) from the latest drop by the end of the week, end of tomorrow if we are lucky. That puts it around an $11.75 price target to sell high.

Comment:

Although the general trend is still up, the security price is walking sideways. I do not expect it to continue bouncing between 11.24 and 11.40 for very long. Watch for the break out.

Comment:

11.75 almost here!

Comment:

Time was wrong, but the price will definitely hit 11.75