The England international is on his way out of the Liberty Stadium and was believed to be on his way to the North East.
But it appears that his determination to be among the highest earners at St James’s Park has led to the Eagles sneaking ahead in the race to secure his signature.
Shelvey himself is also keen to play again for Alan Pardew after he first linked up with the Palace boss at Charlton.
The Swansea City midfielder has been warned by interim boss Alan Curtis that he needs to seize his opportunity in the FA Cup clash at the Kassam Stadium – or risk missing this summer’s Euros.
“Jonjo is a current England international and it’s a big year for him with the Euros coming up,” Curtis said. “He needs to be playing. He will have the opportunity this weekend and I hope he plays well and that we can utilise him in the first team.”
Shelvey has been out of favour at the Liberty Stadium in recent weeks and the Swans will do business in this transfer window if any club meets their £10million valuation.
Curtis – who axed Shelvey from his squad for the 2-1 Premier League defeat at Manchester United last week – admits the former Liverpool player has a sulky side when he is not playing.
“His attitude has always been in question but he just wants to play and he gets frustrated if he is not in the team,” Curtis said.
“If he is in the team, he is not a problem at all. But if he is not in the team he can be... not a problem... but more difficult to manage.”