I believe a generational rally for gold has already begun. But my structural outlook hinges on the former 2011 peak.
Gold must hold above that former high, marking the end of the previous secular bull run.
It’s held this level so far.
But if gold has any chance of printing new all-time highs as it has versus most major global currencies, it needs a little help from its friends…
I’m talking about the rest of the precious metals space – silver, platinum, and palladium.
Silver is hanging tough as it attempts to reclaim last month’s pivot lows. But this is a lonely bullish data point – one I imagine gold bugs wish they could attribute to palladium.
Check out the Aberdeen Physical Palladium ETF $PALL:
Instead of challenging former support from below, PALL is breaking down to fresh four-year lows. The breakdown in palladium fails to reflect the broad demand for metals I associate with the next secular uptrend in gold.
In short, this is not bull market behavior.
To be clear, I’m not interested in shorting PALL. It wouldn’t make sense as my structural view for gold remains higher.
Rather, palladium needs to participate to the upside if Gold has a chance of hitting new all-time highs.
In fact, I doubt gold is trading above its former 2011 highs if palladium and the rest of the gang – platinum and silver – are catching lower.
Silver and platinum are holding their ground as the near-term mess persists. It’s not pretty – but these are the facts.
And this mess could turn downright ugly for the entire precious metals space if buyers don’t step in and support higher prices in palladium – and fast.
