Platinum is trying to rise again after a correction

11 January 2023 171
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The price for platinum, as well as the quotations of other precious metals, began 2023 with the rise. Platinum finished the last year 2022, a very difficult one for all financial assets, with a growth by 11%. For comparison, silver managed to rise only by 3%, the price of gold was almost unchanged, and palladium quotations fell by 6%. And in the near future, platinum may continue to show positive dynamics.

 

The main reason for the price growth could be an increase in demand for platinum. The World Platinum Investment Council (WPIC) expects the global platinum market to face a number of challenges this year. According to predictions, demand for the precious metal will increase by almost 20%, reaching 7.7 million ounces. At the same time, supply will rise only by 2% to 7.4 million ounces. Thus, by the end of 2023 there may be a deficit of about 300 thousand ounces of platinum in the world market.

 

Trevor Raymond, CEO of WPIC, noted that the predicted shortfall is the consequence of a mismatch between the values of supply and demand. While platinum demand continues to rise, supply remains below the pre-pandemic level in 2019. In addition, platinum, together with gold, occupies a special position on the market of precious metals, because demand for it continues to grow, even taking into account forecasts of recession in the economies of the largest countries.

 

After Friday's sharp rise, at the beginning of the current week platinum quotations began a correction and lost half of their purchases. The 50% correction level corresponds to a good range of support at 1085-1090 on the hourly chart. And now the price is moving up from that support to the upside targets at 1105 and 1115.

 

The Stochastic indicator gives a signal to buy, increasing the probability of a new impulse of growth in prices for platinum.

 

 

The following trading strategy option can be suggested:


Buy platinum in the range of 1085-1090. Take profit 1 – 1105. Take profit 2 – 1115. Stop loss – 1080.

 

Also, traders may use Trailing stop instead of a fixed Stop loss at their convenience.

This content is for informational purposes only and is not intended to be investing advice.

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