Palladium Futures (PA1!) Approach Key Supply Zone

Palladium 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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