Palladium: Correction in Feb/March then Rising Again in Q3
Palladium is highly correlated to the SPX movement and Palladium's parabolic shooting star was essentially formed not only from manipulation, speculation and demand, but also, basically 6 months of upside momentum in the SPX.
The SPX in my opinion will likely undergo a deep correction in February and March overall - with some bounces along the way - before rising later in the spring months of 2020. Because of this, I believe Palladium will breakdown (overtime) to the pre-breakout level of the consolidation level which will be anywhere from 1850-2000 depending on the weakness in the equity market. In this case, I am looking for a minimum 15% correction off current levels of ~2280. However, closer to a 20% corrective cycle certainly cannot be ruled out.
Generally, I am looking for Palladium to correct anywhere into the 1850-2000 range.
This weakness in the market will be a good buying opportunity for Palladium (ETF: PALL) but not yet. I believe the SPX will inevitably get to 4000 based on further rate cuts (not a strong economy) and this will push Palladium parabolically higher again around late Q2 or early Q3 for the remaining of 2020 and into potentially early 2021. Inevitably, when a recession does happen (probably won't be widespread confirmed until sometime in mid to late 2021) this will send Palladium into a corrective territory of a 40% drop from the peak.
TLDR: Stay on the side-lines until the SPX shows strength in reaching ATHs, excluding fake-outs. This likely won't occur until sometime in late April-ish where it will regain momentum.
- zSplit
The SPX in my opinion will likely undergo a deep correction in February and March overall - with some bounces along the way - before rising later in the spring months of 2020. Because of this, I believe Palladium will breakdown (overtime) to the pre-breakout level of the consolidation level which will be anywhere from 1850-2000 depending on the weakness in the equity market. In this case, I am looking for a minimum 15% correction off current levels of ~2280. However, closer to a 20% corrective cycle certainly cannot be ruled out.
Generally, I am looking for Palladium to correct anywhere into the 1850-2000 range.
This weakness in the market will be a good buying opportunity for Palladium (ETF: PALL) but not yet. I believe the SPX will inevitably get to 4000 based on further rate cuts (not a strong economy) and this will push Palladium parabolically higher again around late Q2 or early Q3 for the remaining of 2020 and into potentially early 2021. Inevitably, when a recession does happen (probably won't be widespread confirmed until sometime in mid to late 2021) this will send Palladium into a corrective territory of a 40% drop from the peak.
TLDR: Stay on the side-lines until the SPX shows strength in reaching ATHs, excluding fake-outs. This likely won't occur until sometime in late April-ish where it will regain momentum.
- zSplit