Trade of the week: long palladium
We would like to go long palladium since it tests an uptrend line and long-term support zone with a stop loss below the mid-June low at 1,029 and an upside target slightly below the June peak at 1,190.
(Partial video transcript)
This week's trading opportunity
Welcome to "Trade of the week" on Tuesday 26th August, 2025. What I would like to do today is to look at palladium, which we don't often look at. But if you look at the daily chart, what you can see is that earlier this morning, we tested the uptrend line going back to April of this year. And what is interesting is that this uptrend line more or less coincides with the lows seen in the middle of August.
And also, if you look at these lows here going back to June of this year and then the high going back to early June of this year, and we've also got some basically support here going back to October of 2024. So, we can see a confluence of previous highs, previous lows, an uptrend line, all of which may mean that we could bounce off this support area.
And if we were to do so, how far could we go? Well, it really depends. But if we take out the highs seen last week, we could probably pretty easily retest the late June high. So, this sort of area here, and our stop-loss would have to be placed below the last big reaction low. From there, we rallied all the way up to the highs seen back in July. And basically, that's our stop-loss just down there because that is also below these highs here, going back to May.
As I mentioned before the highs going back to January of this year and also the highs going back to November of last year, all of which could act as support if we were to slide further still and dip below this uptrend line.
Previous week's trading opportunity
What we also could look at is last week's Trade of the week very quickly. So EUR/CHF, we basically went short here on, the 18th and had a very tight stop on there. And now we've gone very close to our downside target at €0.9340. And we went down €0.9357. So, what I would suggest as we just get out of this trade because it was a very profitable one with the risk reward set up around 5-to-1.
So, I'd like to cash that one in from last week - another profit in our portfolio. Which brings us, I think, to returns this year to around 27%. And, that's interesting because a lot of people stop following me at the beginning of the year when I got four trades wrong in a row, and we were down around 6.6%.
This week's trade in summary
On that note, today's "Trade of the week" is to go long palladium at current levels, around $1,096.00, and do that with a stop-loss below the lows seen in the middle of June of this year, around $1,029 and with an upside target around $1,190.00. That gives us a reward-to-risk setup of around one and a half.
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