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Palladium is trying to consolidate

Olymp Trade

Palladium continues its correction, forming a pattern similar to a falling wedge on the 4H chart. We could recently see something similar on the gold chart. If it is true, then bears are quite likely to make another attempt to enter the $1275-1310 zone. There is a high probability of a momentum scenario, followed by a similar correction.

An uptend is likely to continue after the current consolidation is completed and the pattern has been formed. However, market participants need to settle down before it happens.

The palladium market is very tight, just like some other metal markets. And the recent high volatility just proved it. In addition, latest macroeconomic data and forecasts do not add optimism. The China Association of Automobile Manufacturers announced that car retail sales declined by 12% in March, to 1.78 million units, after declining by 18.5% in February. As you know, China is one of the major automobile markets, the main and direct palladium consumer.

And last Wednesday, the IMF cut its economic outlook for the second time in a row during the last 6 months. Such reports of a slowdown in the global economy affect the entire market, with no exception. Nevertheless, these factors are local and medium-term. Globally, there will be an imbalance between production and consumption in the market in the next few years.

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Source: https://olymptrade.com/
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