Platinum Turns To A Buy In Gold-Led Inflation Rally


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A couple of weeks ago, we advocated investors to stop any build-up in PGM positions as the platinum metals group appeared to still lack the right signals for a buy, despite posting their first positive month in October after five months in red.

Just a fortnight later, platinum, the front-runner in that group, has become a prime candidate for precious metal investors looking for a new long candidate to join gold and silver, which have been rallying intensely on the back of the inflation-fueled rally.


All charts courtesy of skcharting.com

The surge in prices of platinum, which serves primarily as an emissions purifier for diesel-powered engines, came even after analysts and traders slashed their price forecasts for PGMs in a Reuters poll published on Oct. 28, citing a global chip shortage that forced automakers to cut production of most vehicles.

Auto makers account for some 40% of platinum demand as the metal is embedded in exhaust systems to neutralize harmful emissions. Palladium, meanwhile, is a purifying component for gasoline-powered cars.

The chip shortage had pulled the spot price of platinum from a seven-year high of $1,236.44 an ounce in February to as low as $893.00 by mid-September, while spot palladium dropped from an all-time peak of nearly $3,015 an ounce in April to as far as $1,841.93.

But within just a week of the gold-charged precious metals rally, platinum had broken out as well on pure technical-chart strength, and was on track Friday to a weekly gain of 5%?its biggest in six weeks.

Fundamentally, PGM prices could continue rising if car output recovers, having been dented by broken supply chains and global materials shortages.

More here: https://www.investing.com/analysis/platinum-turns-to-a-buy-in-goldled-inflation-rally-200608174
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volatility favours Palladium, -1000 from the top as compared -316 Pt from recent the top.
when BRICS get together, Pt is still supply overhang
when Pd get to see a new high of $5,000 we can hardly see Pt of $2,000
they have both the possibility of going to a new historic high
Pd is testing new high, not so for Pt