Platinum's 0.9% lower close may pause its advance towards equilibrium | 8 Jan 2021
Platinum Price Forecast relative to Long Term Monthly (LT-M) - Medium Term Weekly (MT-W) - Short Term Daily (ST-D) - and Hourly (not shown) data.
PLATINUM FORECAST
(Previous week in brackets)
| Platinum USD | LT-M | MT-W | ST-D | |||
|---|---|---|---|---|---|---|
| 1063 (1072) ↑ 4,5% |
||||||
| PT Trend | ↑ (↑) | ↑ (↑) | ↓ (↑) | |||
| Pt % Risk Weight |
86 (87) | 83 (84) | 78 (93) | |||
| PM Distribution Total allocation 55% (50%) |
Pt:30% | Ag:40% | Au:30% | |||
Platinum / USD live price
Platinum comment
8 January 2021 close: Platinum had a strong performance going into the new year and appears to be developing a flat correction on the hourly chart. Daily risk weight turned down as a result of the steep drop on Friday 8th Jan which may last a little while longer. The Longer term time scales are at higher risk levels, but have yet to produce a bearish signal. This short term reversal could mean a little pause as almost all attention is on crypto at the moment. Slow moving assets like precious metals are not in favor with speculators. These speculators pay no attention to longer term risk, so it shouldn't worry us. No Change.
31 December 2020 close: The last week of 2020 produced a very nice 10% rally, a little stronger than Gold and Silver. This supports our strong view, since we re-allocated into this investment back in Q2 2020, that Platinum has some way to go and will find its equilibrium again vis a vis Gold. our Pt hold now represents about 17% of total assets which feels like a sound and very acceptable risk. The position is now running at 15% above entry providing a cushion. This metal has been volatile, but having broken that major downtrend from the 2011 peak. More importantly, Weekly and Monthly risk weight time scales are in uptrends and have yet to produce bearish divergence, which they always do before a major trend change becomes fact. This market has price and time on its hands. No Change.
GOLD/PLATINUM Ratio Price Risk Charts & Analysis
(Previous week in brackets)
| Gold Platinum ratio | LT-M | MT-W | ST-D | |||
|---|---|---|---|---|---|---|
| 174 (176) | ||||||
| Trend | ↓ (↓) | ↓ (↓) | ↑ (↓) | |||
| % Risk Weight |
26 (36) | 8 (8) | 10 (1) | |||
| PM Distribution Total allocation 55% (50%) |
Pt:30% | Ag:40% | Au:30% | |||
Gold / Platinum Ratio Charts
Daily Ratio 8 Jan 2021
The correction in Precious Metals has not affected the Gold Platinum ratio much which dropped a mere 2 points from 176 to 174. Our general entry level at around 2.10 and additional net Platinum around 940 still looks a very solid position. The Daily close this week may again drive the ratio somewhat higher but isn't a signal for a long term trend change.
Weekly Ratio 8 Jan 2021
This weeks metals correction makes the very short term outlook slightly uncertain. The weekly could move higher following the Daily trend on some range volatility or an outright correction up of the Gold Platinum ratio towards 1.85-1.90. Platinum is known to get hit harder as metals turned down in recent years, but has performed very strongly in recent months. We give preference to both Longer term risk trends, Monthly and Quarterly, that have yet to finish the move. No Change.
Monthly Ratio 8 Jan 2021
Monthly risk weight is now only offering an interim indcation. The risk downtrend is still in force supported by the longer term Quarterly risk trend which is strongly down as well. The technical picture allows for several reversals and we could easily see a fairly sizeable advance of Platinum vs Gold. This now remains difficult to forecast because short term indicators are bottoming which usually means a milder correction against the long term trend.
Qrtly Ratio 8 Jan 2021
Quarterly risk weight dropped 5 points from 51 to 46 and has some way to travel. Because short term indicators are turning up with Monthly getting into lower risk area we could see an interim bottom before the summer. That signal will come from shorter term indicators. The Long term correction towards our target equilibrium of 1:1 however has not yet finished.
31 December comment:
Daily Ratio 31/12/20
Daily risk rushed down from 73 to near zero filling the divergence gap with longer term timescales and ratio dropping 4% to close at 1.76. These short term movements, even on a weekly timescale are not going to concern us whilst Monthly and Quarterly risk remain in strong downtrends. International financial conditions do not allow for short term risk away from the core precious metals portfolio. No Change to our longer term objective of 1.00
Weekly Ratio 31/12/20
Weekly risk weight shed 8 points on the 4% drop during the short final week of the year 2020. It means that this lower risk level could develop a consolidation price range between 1.70 and 1.85, before following the longer term trends down again. Without bullish divergence in own time scale we remain fully committed to 'hold' until much closer to our target of 1:1.
Monthly Ratio 31/12/20
Monthly risk weight shed just 4 points to 36 and remains in a strong downtrend. This Monthly risk is an important driver and we need patience for this indicator to offer further direction and in relation to the shorter term time scales.
Qrtly Ratio as at 31/12/20
Quarterly risk weight ended the year with marginal change at 51 and has some way to go. The most likely time frame for an initial quarterly bottom is several quarters away depending on size of the move. No Change to favoured Pt portolio