by Nico Isaac
Updated: October 16, 2017
The other day, I took my car in for its annual emissions test. As I was waiting in the driver's seat for the computer to run its diagnostics, I decided to Google "car emissions" for some insight.
To my surprise, I learned that the precious metal palladium is what filters the pollutants from my engine. Thus, I have it to thank for passing my emissions test.
Turns out, precious metals investors also have reason to thank palladium, for becoming the best-performing metal of 2017. In fact, on Monday, October 16, palladium prices soared above the $1000 per ounce level for the first time since 2001.
The problem is, as with any celebrity who experiences a rapid and sudden rise to stardom, the news surrounding that celebrity becomes split right down the middle. Now that palladium is in the precious metals spotlight, it's more difficult than ever for investors to get a clear sense on where the metal is headed, near-term. Here, these recent news items paint a very conflicted picture:
Palladium's bull market is running on all cylinders:
"Forget gold, this metal is on a much bigger rally" (CNN Money)
Palladium's bull market is running out of steam:
"Palladium on 'Edge of a Cliff'" (Seeking Alpha)
Well, in our opinion, the most valuable guide into palladium's future is someone who kept traders on the right side of the metal's very recent past. Here, we turn to our Metals Pro Service analyst Tom Denham.
On October 10, Metals Pro Service prepared palladium watchers for a very specific move: "Over the coming days, a new high above 1000"
"Palladium has pushed high enough to start favoring the upside overall, but my confidence levels will increase with a move above 943.80. For now, the outlook is bullish while price holds above its Fibonacci 0.618 retracement level - now at 924.42.
"Broadly, palladium may be rising in wave iii with potential to continue over the coming days to a new high above 1000."
The next chart captures palladium's strong and rapid ascent toward Tom Denham's upside objective above $1000 an ounce before it let out some air.
The truth is, there's no forecasting method in existence that's 100% accurate all of the time. Elliott wave analysis is no exception. It does, however, silence the outside noise to provide a clear and objective assessment of potential high-confidence trade set-ups in the markets you follow most.