Palladium Futures (PA1!) Approach Key Supply ZonePalladium Futures (PA1!) Approach Key Supply Zone: Is a Reversal Imminent?
June 30, 2025 – Palladium Futures (PA1!) opened the new trading week with a bullish candle, reaching a fresh high at 1,161 after last week’s uncertain Doji rejection near 1,193.5. The metal is now approaching a critical supply zone between 1,199 and 1,255, where traders should watch for potential reversals.
Key Technical Levels in Play
Current Price Action: After a strong push today, PA1! is testing higher levels, but the previous week’s Doji near 1,193.5 suggests hesitation among buyers.
Supply Zone (1,199 – 1,255): This area has not acted as resistance previously, and with price nearing it, a pullback or reversal could be in play.
Daily & Weekly Timeframes: The daily chart shows steady bullish momentum, but the weekly reveals a bearish divergence in Non-Commercial (smart money) positions—raising caution.
COT Report Signals Warning Signs
The latest Commitment of Traders (COT) report reveals interesting dynamics:
Commercials (Hedgers): At their lowest levels since February, suggesting producers are hedging aggressively at these prices.
Non-Commercials (Large Speculators): Still holding elevated positions but showing divergence—price is rising while their net-long exposure weakens.
Retail Traders: Remain bullish, which often acts as a contrarian signal when combined with Commercial hedging.
What’s Next for Palladium?
Given the confluence of factors:
Supply Zone Resistance (1,199 – 1,255): A logical area for profit-taking or short entries.
Bearish Divergence in Non-Commercials: Suggests weakening bullish conviction.
Commercials Hedging at Highs: Indicates potential downside ahead.
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