Stevet has a point. I would need a better understanding of the cycles, contract liquidity etc before entering into the trade. That said TA wise it looks an interesting proposition. PA might be breaking out and completing 5th wave targetting 260+(?). Downside risk near $220. The odds seem to be ok.
What bothers me a bit is:
1. Open interest is only 5.41k (Notional of justr $119mio)
2. yesterdays' volume was only 173 ($100 x $220 x 173 = $3.8mm)
If I recall well Palladium is ao controlled by the likes like Norilsk who earlier this summer bought Stillwater. SWC was, I believe, brought down by having bot too much inventory from Norilsk! It is in Norilsk/SWC to get a higher PA price. Should be good for the longs.
In short, I would not buy but if long would fee good about it and let it run.
I also liked the fundamentals .. the car manufacturers can either use palladium or platinum for catalytic converters .. when palladium roared upto 1000 few years ago the swithed to platinum .. now guess whats recently roared to new highs over 700 !! so what would you do now as a car manufacturer?
Sounds convincing. That said I am TA biased and feel that 1. there are always people out there who better understand the fundamentals than me and 2. fundamentals change (say what happens if less cars get sold because of recession or so. No, I prefer to use price (and other indicators such as volume) as my guiding principle. Good luck with trade. I might join the fun by buying some SWC. Have look at the chart?
I agree re fundamentals and TA .. but always like to back up my TA with a good fundametnal story .. by the way the I think the SWC chart looks just like the Palladium chart .. but with slightly higher gearing (like most mining stocks)
I agree with the posters here that the fundamentals look good for Palladium. The chart looks like we could see a breakout soon (both the weekly and the daily).
What I do not like about Palladium futures is the extremely thin volume and OI (I am referring to the NY contract by the way). Also there are only a few big players (mainly from Russia where most of the Palladium comes from) who control (or should I say manipulate) the market.
I fully agree, the Russian's like the Norilsk guys played a very smart game with SWC which as result almost went under and was rescued by, yes, Norilsk went SWC Board/shareholders had to cease control to them. SWC was, I believe, brought down by having bot too much inventory from Norilsk!
While i have no deep knowledge, I am still supicious about Norilsk/SWC intentions. They have a clear interest to set a high price (which is great) while trying to offload the SWC inventory! But, hey , anything can happen in a manipulated market like PA