• Palladium recoups December losses after rocket rally

• A close above 1,140 required to bolster buying appetite

Palladium futures had a sparkling week, booming by 23% from nearly a five-year low of 922 to a one-and-a-half month high of 1,156 on Friday.

The bulls jumped above the resistance trendline drawn from May’s highs, surpassing the 23.6% Fibonacci retracement level of the April-December downtrend at 1,097 too. Although the price has reached the upper Bollinger band, the RSI and the stochastic oscillator have yet to peak in the overbought zone, making additional gains likely in the short-term.

The 38.2% Fibonacci of 1,200 could be the next target if the current resistance of 1,140 caves in. Then, the bulls could face a crucial battle near the 200-day simple moving average (SMA) and the 50% Fibonacci mark of 1,285, where the price flatlined for three months before it started a new bearish wave. A successful penetration higher would boost buying appetite, bringing the 61.8% Fibonacci of 1,370 next into view.

In the event the bears take control around 1,140, the 1,100 area could ease downside pressures immediately. If not, the price could drift lower to meet the 20-day simple moving average (SMA) at 1,023, while a more aggressive pullback could reach the 925-945 bottom again. The falling support line from June 2022 could be another important pivot point slightly lower at 875 before more sellers enter the market.

Summing up, Palladium futures are fighting for a positive breakout above the 1,100 region as the technical signs stay on the bullish side. A move above 1,140 could motivate more buying.