The short-squeeze play in Palladium markets is still on, but we now see some time-decay on the horizon, TDS Senior Commodity Strategist Daniel Ghali notes.  

Short-squeeze play in Palladium markets is still on

“Commodity Trading Advisor (CTA) buying activity over the last sessions has raised the risk that the long-awaited squeeze on algos could once again come to fruition. Our simulations of future prices do suggest scope for a large-scale short squeeze that would nearly wipe-out algo shorts.”

“However, discretionary traders now hold a larger short position than algos in Palladium markets. Our gauge suggests that this cohort has now nearly reaccumulated its record net short position, which adds vulnerabilities should algo shorts come under pressure.”