CommodityOnline Palladium price surges by 200% in 15 months

Gold fell to as low as $1,145/oz in New York, it then recovered to close with a loss of just 0.86% yesterday. It has risen from $1,153/oz to $1,160/oz in Asian and early European trading this morning. Gold is currently trading at $1,160/oz and in euro and GBP terms, gold is trading at €850/oz and £753/oz respectively.

Gold has recovered from some of yesterday's losses despite the dollar rising again today. Oil prices rising above $85 a barrel after their recent falls may be leading to inflation hedging gold buys. Traders are considering whether this could be the beginning of a period of correction. Were gold to give up some 50% of the recent gains, gold could retest support around the $1,127/oz level according to Fibonacci theory (see chart below).

Palladium has surged by more than 8% since yesterday on the weaker dollar, catalytic converter demand, investment demand and depleting Russian stockpiles.

Silver has jumped from $18.20/oz to $18.43/oz this morning in Asia. Silver is currently trading at $18.40/oz, €13.50/oz and £11.94/oz.

Platinum is trading at $1,728/oz and palladium is currently trading at $545/oz. Rhodium is at $2,850/oz.

Palladium has surged 8% since yesterday (low of $506 per ounce to $545 per ounce now in value) on concerns about depleted Russian stockpiles of the metal and strong industrial and investment demand - especially from the recently created palladium ETF.

Palladium is testing long term resistance between $560 and $584 per ounce (daily and weekly highs from March 2008). It is clearly overbought in the short term and a period of profit taking, correction and consolidation would normally be expected. Especially as palladium has risen by a huge 200% in just 15 months (December 2008).

Ore deposits of palladium are rare and are mostly located in Russia and South Africa. Russian resource nationalism, as has been seen with natural gas, could lead to price spikes and to palladium going higher in the coming months. Some analysts believe palladium may be in deficit for most of the next decade as Russia depletes stockpiles and industrial uses and investment demand for the metal increase.