High-flying Palladium ETF May be Set for a Fall

ETF Trends reported that while the ETFS Physical Palladium Shares (ARCA:PALL) has gained 18.4 percent so far this year, putting all the other physically backed precious metals ETFs to shame, its reign may be set to end.

As quoted in the market news:

In what could be bad news for the broader precious metals complex and some or all of the aforementioned ETFs, PALL’s leadership is being challenged. In the past week, the ETF is down 4.3% and the technical take is more discouraging than encouraging.

‘When it comes to the metals complex, its not been that great of a year for Gold or Silver. On the flip side, Palladium has had a good year, as it was up near 25% YTD a couple of weeks ago. Of late, Palladium is breaking a support line that has been in place the past 9 months,’ said Chris Kimble of Kimble Charting Solutions.

PALL’s recent woes come at the hands of a familiar culprit and it is not increased supply because the palladium market is expected to once again run at a deficit this year. Rather, palladium is denominated in U.S. dollars, making it just as vulnerable as gold and silver to the greenback’s strength. That strength has been on full display lately with the PowerShares DB US Dollar Index Bullish Fund (NYSEArca: UUP)up 3.2% over the past month.

Click here to read the full ETF Trends report.