Palladium Price News: XPD/USD risk reversal teases biggest monthly drop since February

Anil Panchal FXStreet

One-month risk reversal on Palladium (XPD/USD), a measure of the spread between call and put prices, is on the way to register a four-month downtrend according to data source Reuters.

A call option gives the holder the right but not obligation to buy the underlying asset at a predetermined price on or before a specific date. A put option represents a right to sell. That said, the monthly difference between them slumps to -0.725 by the end of Thursday’s trading session, per Reuters. The same represents the biggest bearish bias since February on a monthly basis.

While comparing the same to the XPD/USD moves, the commodity prices are on the way to drop for the third consecutive month despite the latest recovery moves from $2,589.

As the options market signal favors the palladium bears, sluggish momentum and the US dollar rebound should be taken as extra catalysts supporting the commodity’s further weakness.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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