@rsotc, Thanks for the reply! I reversed long at 176.5 and nervous as hell right now. Any suggestions on reversing again to re-enter short? I’m good with Schwab. You must’ve missed this question from me few days ago:
Hi Randy, you had mentioned about having to pay the dividends for stocks we short, so was not surprised about the $62.01 charge for 200 LQD shares. What would you suggest about continuing to hold shorts for hard-to-borrow stocks and have to pay their stock borrowing fees? Just got this from Schwab:
Your short position(s) in the security(ies) shown below has been classified as hard-to-borrow. As a result, as of 04/17/2020 we began charging a daily stock borrow fee to maintain the position. We’ll attempt to notify you if the security’s classification changes to easy-to-borrow.
Please note that stock borrow fees for a short position can change daily as a result of changes in the price of the security and the availability of its shares in the securities lending market.
Ticker/CUSIP: PALL/003262102
Security Description: ABERDEEN STANDARD
Daily Fee:$3.28 (for 50 shares)

While I do expect a bounce off the initial tag of the 1773 support/target on /PA, what you need to consider if trying to game a bounce with PALL is the fact that it is not a very widely held ETF & as such, it is often categorized as a HTB (hard-to-borrow) security. What that means is if you covered your short & reversed to a long to game a quick bounce, there is a very decent chance that you might not be able to re-short it again after the bounce if your broker doesn’t have the shares to lend at the time. Therefore, if you were planning to tuck PALL away for a 50%++ longer-term trend trade, then you may end up missing out on the bulk of the move.

Another consideration is that today’s breakdown in /PA was a very clear & obvious sell signal (at least to me & I would think to others). As such & given my expectation for a 50%++ drop in palladium prices over the next year, typical swing traders might just sit tight on a short trade & ride out the counter-trend bounces, especially at this point (immediately following last night’s big sell signal).

The masses have been smoking a LOT of hopium on the recent rally so when & if it starts to become clear to the herd that a few peaks in the coronavirus curve doesn’t equal “stock market back to new highs & beyond as if no technical & fundamental damage was inflicted to the stock market & the economy”, the rush for the exits could be a crowded one & one that you might not want to risk missing out on. JMHO.

In a perfect world, the only ETF that directly tracks palladium (PALL) would be more actively traded, which would lead to narrow spreads and plenty of available shares to short at most brokers. A perfect world would also have a smaller contract size for /PA (each contract represents about $182,000 of palladium) & the margin requirements are very high. /PAM is the micro (smaller multiplier/leverage factor) contract for palladium but even the best broker for professional & active traders, Interactive Brokers, doesn’t offer it as a trading vehicle because trading volumes are so low.

As such, PALL is probably the best choice for those whose broker has the shares available to lend for shorting (IB did at the time of the short entry & still does as of now). Not a perfect trading vehicle but certainly good enough & does a good job of tracking the price of the metal with the risk of using leverage or being an ETN (vs. an ETF). Sorry you missed it & right now is not an objective time to start a new short position but there will be plenty more trading opps coming down the pike soon.