Palladium price records longest rally in 14 years amid supply worries, rising demand

Palladium has been trading near its highest level since 2001 after rising for the past 12 sessions – its longest rally since 2000, on supply concerns from South Africa, the world’s second largest-producer after Russia, and amid rising demand from the auto industry. The metal is used in pollution-control devices in cars.

Palladium has risen 22 percent in the year-to-date as production decreased during a five-month strike by 70,000 employees in South Africa that came to a close last month.
Auto sales in the US are set to complete their best year since 2007, while retail deliveries of cars, multipurpose and sport utility vehicles climbed 14 percent in China last month, according to the Passenger Car Association, as reported by Bloomberg.

"It's going to be a while until everyone is back at work and producing, and inventories build up to previous levels," Frank McGhee, head of precious metals at Integrated Broker Services, told the Wall Street Journal. "The rally is starting to look a bit overdone, but that doesn't mean it can't continue," he said.

Spot palladium was 0.15 percent down to $869.6 a troy ounce as of 11:07 BST. The price is 12.9 percent above its 200-day simple moving average, while its 14-day relative-strength index stands at 68.49 close to the 70 level, which some technical analysts view as an indicating the market is overbought. Yesterday, September futures hit $876 on the New York Mercantile Exchange (NYMEX), their highest since February 2001.

NYMEX platinum futures for October delivery were up 0.61 percent to $1,505.6 an ounce as of 12:34 BST. They touched $1,523.0 on July 2, their strongest since September 4, 2013.