Since August 2018 Palladium finished a correction and then started to soar. Palladium produced decent corrections during this time. I believe we are coming to the end of this bullish cycle as on January 17 palladium peaked at $1430 and then proceeded into another correction. Many may think it will be a correction but a bigger bear market will push palladium prices much deeper than anyone can imagine at this time.
In January 2018 palladium also peaked and a 7-8 month bear market ensued. The entire palladium Cycle degree Idealized wave count is diagonal, so another Primary degree zigzag bear market can happen and they happen when market players least expect.
If this wave 3-4-5 in Minor degree is true, then the 4th wave bottom in August 2018 will never hold. Palladium might give us temporary support at $830 but bigger support would be closer to the $500-$600 price level.
You will read many stories about the palladium supply shortage with forecasts that prices will be much higher this year. I’ve heard all that “fundamental logic” many times before in gold and oil, and still, the market in question crashed. All we need is for buyers to take a rest and all the protective sell stops can start to get hit. All the bullish traders suddenly turn into palladium bears and the analysts will start telling us the change in fundamentals. Fundamentals are lagging indicators and you just have to be patient and the analysts will find you a reason why palladium is crashing.
The crowd loves to buy high, and they can get convinced to be “bullish” just when they should be very bearish. The COT reports are just about one month old, but commercials were net short in late December 2018 already. Not until the shut down is over and done with will the COT reports get updated.