Below is a chart of Palladium from the bottom of late 2008 until today.
I added Fibonacci Retracement levels, as well as Fibonacci Fan lines.
We can clearly see why price is struggling with the $700 right now, as there is both the 76.40% Retracement level from the bottom in 2008 to the top in 2011, AND the 50% retracement level from the top in 2011 to the bottom of late 2011.
We can see that this $700 level has acted as both support & Resistance during the last 2 years…
Below is a 4H chart of Palladium, showing once again that Fibonacci is clearly at work.
Please note the Negative Divergence between Price and MACD on a 4H basis…
This could mean a short term top is in, and that Palladium could retrace over the next couple of days.
If the top was set yesterday, The first target would be $670, followed by $655 and $642.50′ish (all are Fibonacci levels).
$670 is very likely on a daily basis if price doesn’t break through $700, due to the fact that the middle bollinger band (or 20 days moving average) is currently at $665 and rising (meaning it will soon reach this $670 level), where it should provide (at least some) support.
If $700 would break to the upside, then I expect a lot of technical buyers to step into the market, as we would then have a higher high in price…
PS: if you want to do some technical analysis yourself on Commodities, Currencies or Indices, go to http://www.forexpf.ru/_quote_show_/java/show_...php?type=SnP500 and under “Symbols” you can select the asset you would like to chart.