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Trade of the week
How to long palladium
We would like to go long on palladium as it tests an uptrend line and long-term support zone, with a stop loss set below the mid-June low at 1029 and an upside target slightly below the June peak at 1190.
(AI video summary)
Current trade overview
For this week's focus, the suggested trade is to go long on palladium. The palladium market, though not frequently examined, currently presents an intriguing setup. Observations of the daily chart reveal testing of the uptrend line established since April. This significant support area aligns with the mid-August low and correlates with previous lows from June.
Trade setup
- Entry point: at current levels around 1096
- Stop loss: place below the mid-June low at approximately 1029
- Target: set upside target at 1190
- Risk-reward ratio: around 1.5 to 1, providing a balanced opportunity for traders.
Market context
the support level reflects resistance observed in early June and extends back to October 2024. Such a convergence of past highs and lows, along with the uptrend line, suggests a potential bounce from this support zone. If palladium rebounds from this level and surpasses last week's highs, there is potential to retest the late June peak..
Cautionary note: while this trade presents a structured opportunity, market conditions can change rapidly. Traders are advised to consider their risk tolerance and market outlook before engaging in this trade.
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