The possible corrective reaction we expected last week did not materialize with the Gold Platinum ratio consolidating in the 1.65-170 range. The short term picture still favors further upward correction and this could even last a bit longer as weekly is also pushing up. We prefer to see a deeper risk weight dive in the Monthly and Quarterly time scales before considering a short term exit.

Last week's observation for the Gold Platinum ratio to consolidate in a higher price range (170+) still applies. As we are in a primary AU/PT downtrend we can expect bullish divergence to develop with a wider calendar spread of 6 to 9 months. Price objectives are 1.60, 1.20 and 1.00. Our allocation spread therefore allows for some Platinum weakness, which can lead to a larger allocation to Platinum if strong bearish divergence between short and medium term timescales is building.

Interim Monthly risk weight fell just 2 points to 22 this week and is expected to reach a deeper sub 10 level as price reaches our expected targets. This could take many months with some correction along the way.

Quarterly risk weight declined just 1.5 risk points to 41 and is also expected to at reach a sub 15 level at a quarter end print and sub 10 as an interim print. We should normally be able to act on strong shorter term oversold signals to maximise the result from the present Platinum allocation.

A healthy reaction to the steady downtrend in force since early November. A few days of upward correction in the Gold/Platinum ratio can quickly develop bearish divergence between short en long term timescales. With Monthly and Quarterly in strong downtrends we stay with our slightly favoured Platinum allocation with a view to see this through towards Gold/Platinum 1:1 equilibrium.

Weekly Gold Platinum ratio risk weight indicator shows potential bullish divergence. That may materialize if the ratio moves even a little bit north again and could last perhaps up to 4 to 6 weeks.

Monthly risk weight is half way the period has dropped to 24 and is likely to reach a sub 10 level aty the time of an interim price bottom. This is one indicator to watch closely unless we see bearish divergence developing in the meantime between short term and long term risk weight.

Quarterly risk weight at 1/6 of the period declined a further 4 points to 42. This downtrend is in full force and likely to drop into a sub 15 low risk range before we see a significant bottom.