Palladium price has eased on its downtrend as the financial markets enter a high-impact week. Investors await fresh cues from the October Fed meeting, US PCE index, and Q3 earnings from major tech companies.
Meanwhile, HSBC has lowered its 2026 forecasts for platinum and palladium prices. In a note published late last week, the bank cited investor liquidation and a shift in the market fundamentals as key drivers of the selling pressure observed in both metals.
In line with these factors, it has adjusted its predictions for the average palladium price from $1,546 an ounce to $1,436. However, constraints in mine supply is expected to continue offering support to palladium price. Besides, the potential in the metal being fundamentally undervalued is a bullish factor.
Palladium price awaits fresh cues from major economic events
In the ensuing sessions, investors will be keen on the Fed’s interest rate outlook and the movement of the US dollar. In particular, the US central bank is slated for a two-day policy meeting this week.
The crucial economic event comes at a time when elevated crude oil prices are bolstering higher-for-longer interest rate expectations. Late last week, the benchmark for global oil prices, Brent futures, extended its previous gains to trade at a seven-month high at $117 a barrel. That marked its fourth consecutive week of gains as the persistent disruptions along the all-important Strait of Hormuz impact the global oil supply.
Brent oil price has since declined to $109 a barrel; down by 0.46% as at the time of writing. The decline is fueled by renewed hopes over US-Iran peace negotiations. However, persistent uncertainties have the bulls defending the support at $109.
Amid the elevated crude oil prices and heightened inflation concerns, the market maintains a hawkish interest rate outlook. On the one hand, investors expect interest rates to remain unchanged at between 3.75% – 4.00% during the October Fed meeting. However, they are increasingly pricing in a hike in December.
While precious metals are viewed as a conventional hedge against inflation, an environment of higher interest rates tend to weigh on the non-yielding assets. In addition to the Fed interest rate decision on Wednesday, palladium price is also set to react to the Fed’s preferred gauge of inflation, the US PCE index.
Additionally, major tech companies like Microsoft, Alphabet, and Meta are expected to release their Q3 earnings in the course of the week. The earnings release will be of particular interest as the tech sell-off continues to weigh on the risk sentiment and the Treasury yields.
The US bond yields have held firm at the onset of the high-impact week; offering some support to the US dollar. Similar to other dollar-priced assets, palladium price tends to move inversely to the value of the greenback.
Palladium price technical analysis
Palladium price eased on its downtrend on Monday as investors await further cues from the week’s crucial economic events. The precious metal has been in the red for 7 out of the past 8 weeks. At the time of writing, it was trading at $1,033; hitting a fresh 4-month low.
A look at its daily trading chart hints at continued selling pressure in the short term. To begin with, it continues to trade below the short-term 25-day EMA and the medium-term 50-day EMA. Notably, the bearish death-cross pattern formed by the two technical indicators in mid-September is still in place. Besides, at an RSI of 26, palladium price is deep in the oversold territory.
Based on both the fundamentals and technicals, the asset will likely trade within a tight range in the near term. More specifically, the range between the current support at $1,034 and the $1,089 is worth watching. The expected corrective rebound will likely be curbed at $1,146. On the flip side, further losses may have the bulls defending the lower support at $1,020.
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