A detailed explanation why platinum is likely to outperform gold can be found in one of our recent essays, but the most important factors here seem to be the fact that platinum has historically been the more expensive metal, with last year being an exception and that just recently platinum’s price has exceeded gold’s. And when we add to that the supply problems, which are the result of strikes in South Africa (which produces 75% of world platinum supply) the outlook for platinum does indeed seem encouraging.
In this chart, we see the ratio is now above 1.0, and the breakout is being verified (successfully so far). Platinum is now more expensive than gold. The ratio broke above 1.0, moved back to it and has moved slightly higher again. We could see more consolidation here, but the long-term implications remain unchanged. Platinum is expected to outperform gold in the months ahead, and the ratio is therefore expected to move higher as well.
A major bottom was seen at the end of 2011 (close to the powerful long-term turning point) and in early 2012. A breakout has now been seen above the long-term declining resistance line in this ratio, and it seems that a big comeback for platinum to much higher prices is likely. This will pay off big time for those invested in platinum for the long run.
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Fundamentals, Technicals Supportive Of Platinum To Outperform Gold
Published 02/05/2013, 05:42 AM
Updated 05/14/2017, 06:45 AM
Fundamentals, Technicals Supportive Of Platinum To Outperform Gold
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