Platinum Group Metals: Progress Continues For 2020

Alas, it is normally the case that once financial journalists get on the back of a story, the story is about to end. This very often means inadvertently calling the top – or the bottom of a market run, depending on where it is in its journey.

By Zak Mir 

However, while there have been some painful false dawns for the likes of Gold and Silver over the past 10 years. The flaws here have been that the bull argument has very often depended on the elusive “store of value” concept.

However, what the “experts” did not count on was no soaring inflation despite QE and a general asset bubble inspired by near-zero interest rates. Instead, it would appear that the rally we have seen kicking in properly in H2 2019 has been inspired by the rather more pedestrian sounding concept of supply and demand.

This point has been underlined by the way that the geopolitical drivers we have been treated to in recent days have only offered a temporary acceleration to Gold.

gold

What can be seen on the daily chart of the yellow metal has been a brief spike through $1,600 before slipping back to the more sustainable mid $1,500s – maintaining the recovery trend – but not quite as frothy as some might wish to see.

ppr

Clearly, the PGM’s, especially in the form of Platinum, Palladium and Rhodium, the supply and demand concept has worked far more notably than store of value, as these metals are now core players in the “Greenification” of the motor industry, especially with reference to catalytic converters. But, perhaps much to the joy of bulls of PGMs we have seen this particular asset class maintain the benefits of being geopolitically sensitive, as well as having a practical purpose helping them maintain their rally.

READ
Share Talk Weekly Stock Market News, 19th January 2020

palladium

The stars of the show remain Palladium and Rhodium, with the daily chart of the former still offering a possible $2,400 3 months technical target. At the same time, the short term target of Rhodium allows us to seek out $10,000 on a three months timeframe, given the sharp momentum behind this market.

rhodium

All of this suggests that even the relatively pedestrian progress of Platinum – a market which appears to be mirroring the conservative price action of Gold, could still retest or even exceed the previous 2019 peak of $1,000 before Q1 2020 is over.

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Disclaimer
Zakmir.com is a purely journalistic website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here


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