Investing.com - Palladium's rally has spawned calls for record highs above $1,500, but the auto-catalyst metal may run out of gas first and fall into a range for a while, just like gold.
Used for purifying auto emissions, palladium dropped $17.75, or 1.3%, on its spot price on Friday to trade at $1,382.65 per ounce by 2:00 PM ET (19:00 GMT). On Thursday, it hit all-time highs of $1,440.35, making it the world's most valuable metal.
In futures trade, the benchmark March palladium contract on the New York Mercantile Exchange's Comex settled down $13.10, or 1%, at $1,335.10.
Since surpassing gold's 2019 highs of above $1,300 on Jan. 4, palladium's spot price renewed its highs at the top five more times, culminating in Thursday's run above $1,400 for the first time.
Gold has treaded water in a broad $1,285 to $1,295 range after a Jan. 4 peak of $1,300.40 on its spot price.
The spot price of gold, or bullion, was down $9.66, or 0.8%, at 1,282.37 by 2:00 PM ET.
On Comex, February gold futures settled down $9.75, or 0.8%, at $1,282.60.
Palladium's run-up has been fueled by stimulus measures aimed at boosting car ownership in China. Also helping was a projection by Metals Focus that supplies will remain in deficit this year for an eighth-straight year.
Even so, the auto-catalyst metal's near-10% gain since the start of the year -- and 70% jump since August -- may be overdone, some say.
"Looking at how high far we have progressed and how fast, the price of palladium is way overdue for a correction, especially if the news stories start to dry up" on its supply shortage, said Walter Pehowich, industry analyst and executive vice-president at Dillon Gage Metals in Addison, Texas.
Pehowich said estimates for 2019 palladium short supply range from as low as 250,000 ounces to a high of 1 million ounces "depending on who you talk to".
"If fresh metal comes into the market place ... a sell off could occur," he added. "And that’s what I expect to happen."
In other precious metals on Comex, silver futures slid by 15 cents, or 1%, to $15.39 per ounce.
In base metals,copper rose 3.4 cents, or 1.3%, to $2.71 per pound.