Renowned Senior Commodity Strategist Daniel Ghali predicts a shift in the platinum markets as CTAs prepare to add back their shorts, setting the stage for potential price declines in the upcoming week.
CTAs Ready to Resume Selling Activity
Ghali warns that only a significant uptick in prices could prevent CTAs from initiating selling activity, with simulations indicating a high probability of CTA selling even in the case of an uptrend. This imbalance could lead to a potential -35% increase in algo selling, creating a bearish outlook for platinum prices in the near future.
Additionally, the palladium markets are also showing signs of vulnerability to a sell-off, with CTAs expected to resume selling activity despite some initial buying interest. The window for an algo short-squeeze play is closing rapidly, leading to diminishing upside potential and emerging downside risks in the palladium markets.
Expert Analysis and Implications for Investors
For investors in the precious metals market, the insights provided by Daniel Ghali highlight the importance of monitoring CTA activity and market dynamics. With the potential for significant price fluctuations in platinum and palladium markets, investors may need to adjust their strategies to mitigate risks and capitalize on emerging opportunities.