Palladium rises 12.9% in one month & the powerful uptrend looks set to continue

Since writing about the excellent potential of palladium on 9 January, the part-precious, part-industrial metal has risen by 12.9%, and the powerful uptrend looks set to continue.

As mentioned in the 9 January article Palladium could be one of the star performers of 2013 & beyond, the outlook for palladium is very bullish: “thanks to strong demand from the car industry and stagnant mine supply, this vital industrial/ precious metal could be one of the star performers of 2013 & beyond.” Since then, in a little over one month, the price of palladium has risen by 12.9%.

As the chart below shows, palladium began its recent advance in July 2012 and has since established a powerful uptrend (green lines).

An 8 month daily chart of palladium (Click on the chart for a larger version)

An 8 month daily chart of palladium (Click on the chart for a larger version)

Chart courtesy of stockcharts.com

As the stochastic oscillator (circled) shows, short-term momentum is to the downside, however the longer-term fundamentals are still favorable.

In a recent monthly commentary, Tiberius Asset Management, a Swiss commodities fund manager, said that “Palladium is one of our favourite picks among the metals over the long term”, and that the metal was one of “only a handful of industrial commodities” facing a sustained market deficit, along with platinum, tin and lead.

The 9 January article noted that “the best way to gain exposure to higher prices is likely via a physically-backed exchange traded fund (ETF). ETF Securities provide two Physical palladium ETFs, the ETFS Physical Palladium Shares, which is listed on the NYSE ARCA under the symbol PALL, and the ETFS Physical Palladium, which is listed in London under the symbol PHPD.”

Since 9 January PALL is up 13.7%, while PHPD is up 14.3%.

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