Yesterday, the price of Palladium reached another all-time high at $ 1,436.50 per ounce.
The price of Palladium took another leg up on the news that Chinese officials are considering increasing domestic automobile purchases. China’s top auto dealers have submitted a proposal to cut in half the 10% auto tax on car sales to support domestic sales.
U.S. trade representative Robert Lightizer and Treasury Secretary Steven Mnuchin announced they were in talks with Chinese Vice Premier Liu He about reducing tariffs on U.S. cars from 40 percent to 15 percent.
Depending on who you talk to, current estimates in a short fall of Palladium supplies in 2019 are anywhere from 250,000 ounces up to a million ounces.
These kind of numbers along with positive comments between our delegates and Chinese officials should keep higher Palladium prices in play.
But on the other hand, looking at how high we have progressed and how fast, the price of Palladium is way overdue for a correction, especially if news stories start to dry up. Keep a close eye on the Palladium EFP, it hasn’t moved much. If fresh metal comes into the market place, the current EFP of minus 50 minus 30 should come in and a sell off could occur. And that’s what I expect to happen.
Gold
It seems the rally in the price of Gold is starting to lose traction as some long holders of the metal have given up hope that the market can break through the $1,303 level of resistance.
Steadying equity markets and a little good news out of the Brexit negotiations, even though a deal that would satisfy both parties are a long shot, has taken some wind out of the sails in the price of Gold.
Just listening to all the rhetoric between both parties over this Government shutdown has forced me to increase my migraine medication. I sure hope this ends sometime soon. (In case you are wondering, the shutdown has had no effect on the Precious metal markets.)
Have a wonderful Friday.
Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.