Loading ...Palladium Approaching Parity with Gold
For almost 16 years Mr. Market has valued Gold higher than Palladium. The last time these metals were equal was back in the year 2002 when both metals hovered around 300.
From 2003 through 2018, the Palladium:Gold ratio built out a 15 year inverse head and shoulders with a breakout above the neckline in late 2018. In November 2018, the $PALL:$GOLD ratio reached a value of 0.98, almost hitting the 1.0 Parity Line.
Back in 2001, the ratio hit a high around 4.0 (Palladium valued 4X more than Gold). If the ratio were to retest 4.0 while Gold remained static at 1300, this implies an upside target price of 5200 for Palladium, roughly 3.33X higher than Palladium’s current price around 1200.
For now, Mr Market values Gold slightly higher than Palladium. But if the $PALL:$GOLD ratio breaks through and sustains above the 1.0 Parity Line, I would research Palladium mining stocks, especially if the ratio develops a trajectory to retest the 4.0 level from the year 2001 highs. -Harry
Wow…never considered !
Lowly Palladium ( a base metal) more valuable than gold ?
I tell you one thing ..If I had some of that palladium …I’d be happy to exchange it for equal weight in gold
sheesh
Going out to melt down my catalytic converter
Kidding aside Sir Harry
That is one beautiful chart.
Confusing as hell too…If that beautiful breakout holds and history repeats we may see a LOT lower Gold prices
Unless Palladium just goes ballistic for some reason
Indeed, Fully, this chart makes you wonder what fundamental trends would arise to cause PALL to become more valuable than GOLD. For example, popular knowledge is that the migration to electric vehicles will reduce demand (and price) for Palladium going forward. Perhaps Mr. Market will prove that idea wrong in the coming decade?
Recent article on Bloomberg regarding growth of Hybrid cars. Use of Palladium in Hybrids is forecast to triple from 2016 into 2019:
https://www.bloomberg.com/news/articles/2018-12-28/another-reason-to-be-bullish-on-palladium-the-hybrid-car-boom
Great chart. Thanks.
Nice charts, you beat me to it. Drew this a few days ago thinking nobody was on it. I show this already with a BO and BT FWIW.
https://www.tradingview.com/x/iYOBo9rE/
That’s a good chart Schism! Clear BO and BT with the angled inverse head and shoulders. Plus, with your additional upwards channel from head to right shoulder, looks like Palladium surpassing Gold is a stronger possibility now!