News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bullish
Oil - US Crude
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Mixed
Gold
Mixed
GBP/USD
Mixed
USD/JPY
Bullish
More View more
Real Time News
  • Make smart trading decisions with your free guide to trade the news. Download your free guide here.https://t.co/pb5E2KgRzW #DailyFXGuides https://t.co/E9ZmJvqO0z
  • Currency exchange rates are impacted by several factors. Are different world leaders a contributing factor? Find out here: https://t.co/4jsORznRTE https://t.co/fqxw1AoKc1
  • Gold snapped a two-week losing streak but keeps price within the broader August downtrend. These are the levels that matter on the $XAUUSD weekly chart. Get your market update from @MBForex here: https://t.co/B3Jct6mIBD https://t.co/xTGIM2hRBv
  • $GBPUSD continues to move higher, despite Friday’s weakness, as vaccination hopes continue to fuel positive sentiment despite ongoing lockdown fears and downbeat UK data. Get your market update from @nickcawley1 here: https://t.co/S8UoHzOwFN https://t.co/qI6UZdggvM
  • Risk management is one of the most important aspects of successful trading, but is often overlooked. What are some basic principles or risk management? Find out from @PaulRobinsonFX here: https://t.co/IsnpfJhp91 https://t.co/6wxX6oQurn
  • Recessions can devastate the economy and disrupt the fortunes of individuals, businesses, and investors. But economic decline in the business cycle is inevitable, and your trading can be defined by how you respond to crisis. learn how to prepare here: https://t.co/e4CnobJCss https://t.co/w009tJEQZn
  • Looking for a new way to trade reversals? One of the most used reversal candle patterns is known as the Harami. Like most candlestick formation patterns, the Harami tells a story about sentiment in the market. Get better with trading reversals here: https://t.co/rfwUWJfbz9 https://t.co/2AeO1AdD2M
  • MACD who? The Moving Average Convergence Divergence (MACD) is a technical indicator which simply measures the relationship of exponential moving averages (EMA). Find out how you can incorporate MACD into your trading strategy here: https://t.co/ZNs4Qi8ieG https://t.co/INJz4NSugQ
  • Knowing how to accurately value a stock enables traders to identify and take advantage of opportunities in the stock market. Find out the difference between a stock's market and intrinsic value, and the importance of the two here: https://t.co/QszmdZX8cS https://t.co/qdrsi61CN8
  • It seems the markets are riding high, but risk is always lurking around the corner. Consider your escape plan before you find yourself in collapsing market. What are the top havens for different conditions in 2021? Find out from @JohnKicklighter here: https://t.co/1oeXWEsJkb https://t.co/IyQdfq29fz
Palladium Decline May Be Offset by Virus-Induced Supply Shock

Palladium Decline May Be Offset by Virus-Induced Supply Shock

Dimitri Zabelin, Analyst

Palladium Price Outlook, XPD/USD Analysis, Coronavirus – TALKING POINTS

  • Palladium prices may fall as global demand shrinks from coronavirus pandemic
  • But supply shocks could amplify XPD/USD losses amid South African lockdown
  • After painful liquidation, XPD/USD rallied over 40 percent but is now fizzling out

How Has Coronavirus Impact Palladium Prices?

As a cycle-sensitive commodity, palladium has been a victim of the market-wide liquidation in risk-oriented assets as the coronavirus undermines global growth prospects. In 2019, XPD was the best-performing precious metal; year-to-date it is up only 14% after recently recovering from seven-month lows. Having said that, the disruptive nature of Covid-19 may in fact be a hidden source of support for palladium prices.

South Africa – the second-largest producer of the precious metal after Russia – recently announced a strictly-enforced 21-day lockdown and extended these measures to its mining operations. Following the government’s decree, XPD/USD registered its largest one-day increase since 1997 and rose almost 25 percent. This disruption to production amplified the precious metal’s structural undersupply and helped buoy prices.

Palladium is typically extracted as a secondary product from mining operations targeted at other metals like nickel. The lag time between extraction and distribution consequently drove XPD/USD to record-breaking highs as demand for its use in catalytic converters surged in 2019. With the lockdown in place, global supply will likely be tightened and could help offset the downward pressure of weaker global growth.

The mining giant Anglo American announced that its Mogalakwena extraction site – the second largest in the world for palladium deposits – has reduced its output and number of workers on the premises. Having said that, the company followed up that these measures are subject to change. Palladium traders may therefore start to closely monitor developments in South Africa since policies there can influence XPD/USD price swings.

Palladium Price Chart

Palladium prices have surged since bottoming out at September 2019-lows following the double-digit selloff at the February peak. However, XPD/USD’s over 40 percent rally may be coming to an end as the precious metal shows signs of exhaustion. If palladium turns lower, selling pressure may accelerate until prices hit support at 1950.50 where the downside force of sellers may be overwhelmed by buyers.

XPD/USD – Daily Chart

Chart showing palladium prices

XPD/USD chart created using TradingView

PALLADIUM TRADING RESOURCES

--- Written by Dimitri Zabelin, Jr Currency Analyst for DailyFX.com

To contact Dimitri, use the comments section below or @ZabelinDimitrion Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES