Major trends in important traditional asset classes can be identified by the simple observation that they are correcting from an outside trange price level into equilibrium. This is happening with Platinum and with Silver via a vis gold. 50 year equilibrium (1971-2021) is now at 0.88. Or AU at 1800 and PT at 2000.  The corrective move we now experience will need time to complete. The most likely scenario is for this ratio to sweep through the equilibrium before finding its speculative bottom.

Weekly risk trend turned up at same level, which produce some upward price pressure, i.e gold to recover somewhat from its relative weakness in coming weeks. Considering all timescales, the ratio can expect further pressure as short versus long timescale bearish divergence will determine the medium term and long term future.  This is the kind of scenario that develops in nearly 100% of all fast moving markets.

19/2: Monthly risk has dropped to 9%. This is low, but fast moving markets seeking their natural equilibrium may pause but not stop until such balanced price point has been achieved. Markets will typically shoot beyond those balance price points and experience some serious and increasing volatility in the process.  Only active traders with physical longs should trade or hedge with short term derivatives, but not more than 30% of the physical position. Leveraged portfolio's are outside of our risk management parameters.

12/2: Looking at the Gold/Platinum monthly chart we notice a strong price trend south and equivalent risk weight closing in on oversold. The chart also shows how past monthly risk weight levels, up or down, often took one year or more before the primary trend tops or bottoms out. We should expect the same. It is a strong trend and we have a substantial cushion to allow for any medium term reversal and a major extension towards and beyond the 1:1 ratio. At the present level of Gold, platinum has another $600 dollars to go and we expect to see that happening sooner rather than later due to a much more limited market liquidity in physical platinum.

19/2: Of course the interim figures are showing further decline and the current level is at 24%. This major downtrend of the Gold to Platinum ratio historically should take several more quarters before the shorter term timescales signal a potential bottom exit. The base wealth preservation position is a substantial 50% with a fairly evenly diversified precious metals portfolio where Platinum rates at 35%. If Pt moves substantially closer towards its 50 year equilibrium, the  Platinum share of total precious metals will increase and may need to be rebalanced to remove speculative risk.

12/2: Interim Quarterly risk weight closed the week of  8-12 Febr at 28 versus 37 last week. This rapidly dimishing risk weight is pretty common after  a market has lost 35% of its value from the March 2020 peak. The current ratio at 1.46 is still well above the average ratio price based on a quarterly close for the past 50 years. That average 200 quarter Gold/Platinum ratio is 0.88.  We have also seen Pt trade at a ratio of 0.5 on extension just like the totally unreal pump to 2.26 last March. 0.5 ratio means Platinum would need to gain another $2,400 relative to gold. It has happened before.

The Daily Gold/Platinum ratio risk weight dropped sharply again into a potential oversold condition as a result of the strong increase of the platinum price last week. This ratio market is not attractive to trade short term due to relatively high conversion margins in the physical market space. A temporary reversal may materialize, but we shall not attempt to maker changes to the present metals allocation until Long term Gold/Platinum risk weight indicators become clearer as to a more pertinent change of trend.

Weekly Gold/Platinum ratio risk weight is in an oversold range, but the downtrend has been substantial enough to expect further weakness over a longer timescale. Yes we may see a weekly bullish divergence reversal and one that may quickly fail a more common risk weight analysis. Strongly trending markets like Platinum are known to extend often beyond target dates and prices. Platinum is also known to extend beyond the 1:1, hence better risk to hold Pt even if Gold starts to outperform Platinum for a few weeks or months.

Looking at the Gold/Platinum monthly chart we notice a strong price trend south and equivalent risk weight closing in on oversold. The chart also shows how past monthly risk weight levels, up or down, often took one year or more before the primary trend tops or bottoms out. We should expect the same. It is a strong trend and we have a substantial cushion to allow for any medium term reversal and a major extension towards and beyond the 1:1 ratio. At the present level of Gold, platinum has another $600 dollars to go and we expect to see that happening sooner rather than later due to a much more limited market liquidity in physical platinum.

Interim Quarterly risk weight closed the week of  8-12 Febr at 28 versus 37 last week. This rapidly dimishing risk weight is pretty common after  a market has lost 35% of its value from the March 2020 peak. The current ratio at 1.46 is still well above the average ratio price based on a quarterly close for the past 50 years. That average 200 quarter Gold/Platinum ratio is 0.88.  We have also seen Pt trade at a ratio of 0.5 on extension just like the totally unreal pump to 2.26 last March. 0.5 ratio means Platinum would need to gain another $2,400 relative to gold. It has happened before.