PlatinumEmerging from a Long Bear Slumber
Platinum is emerging from a very extended bearmarket similar to silver last summer. Since its peak in 2008, platinum had beenin a downward channel and had lost half its value. From 2016, while still in the major downtrend, platinum has also been carving out a base (ignoring the COVID blip). Major resistance (and breakout level) is around $1,020 (+/- $20), as marked by the red line. The target price is $1,350 on a successful breakout (upper red dash line). The chart setup is excellent and is one of the most attractive long-term bearish-to-bullish rotations we have seen.
Long term, platinum can be potentially substitutedfor palladium. Interestingly, the platinum-to-palladium ratio is setting up apattern similar to 20 years ago. Similar to silver, platinum is positivelycorrelated to pro-cyclical environments. Platinum's 10-year R-squared to copperis 67%, R-squared to silver is 72%, but only an 11% R-squared to gold. We alsonote that platinum held in ETFs is under massive accumulation, up 63% since the2019 low.
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