By Tamar Mehr

When tension rises around the world, we tend to see a flight to traditional safe haven markets such as the Japanese Yen, the Swiss Franc, and of course to Gold. And there has been plenty of talk in the media of late about Gold’s attractions. But today we will be suggesting you may want to look at the prospects of another metal, Palladium.

For despite the build-up in the media, the price of Gold has been trading since the beginning of the year in a narrow range between 1,200 to 1,300 and has not yet broken out of this range. Last week saw the price yet again testing the resistance level at around the 1,300 and falling from it, meaning that Gold still remains range bound on this long-term time frame.

In contrast, let’s take a look at the chart of Palladium, a relatively rare and lesser known metal from the Platinum group of elements, commonly used in the automotive and electronics industries. The price of Palladium has been rising steadily during the same period.

Looking at the weekly chart we can spot a well-established up trend, with moving averages fanning and in the correct order and a good convergence on the momentum indicators. However, price action is currently over extended from the buy zone - the area between the 10 and 20 moving averages.

Going down the timeframes, the daily chart also presents us with an established up trend, with moving averages fanning in the correct order and strong convergence on the momentum indicators.

On a closer look, we can spot the area around the psychological round number of 900, which was tested several times before price action eventually broke strongly above it. However, in this timeframe as well, price action is currently over-extended from its buy zone and has started to pull back. Now let’s add a Fibonacci retracement. The first one is taken from the latest swing low to the most recent high, and we can see that the previous resistance area at around 900 is clustering with the 61.8% retracement.If we add another Fibonacci retracement, taken from the previous swing low to the most recent high, we find that we can now add 50 percent of this move to the list of technical ingredients, all clustering at around the same level.For a technical trader, each additional one of those ingredients can strengthen the cluster and can increase the odds that a trading opportunity of this cluster, could end up with a potentially successful outcome. As such I am currently stalking long positions at or around that triple support cluster at 903 which could eventuate within the next few trading days.

So forget Gold, at least for now, as there is a new metal in the spotlight!