Platinum price analysis ahead of US-Iran ceasefire deadline

Platinum price continues to trade sideways after recording three consecutive weeks of gains. As the fragile US-Iran ceasefire agreement nears its end, investors are concerned over fresh combat in the Middle East. Subsequent fading of the risk appetite has curbed platinum price gains without necessarily heightening the selling pressure. 

The wait-and-see mood is observable across the financial markets. In addition to the precious and industrial metals, the US dollar and Treasury yields are also range-bound ahead of the Wednesday ceasefire deadline. 

Risk of fresh combat weighs on platinum price

Platinum price continued its consolidation phase into the new week as investors weigh the likelihood and possible impact of fresh combat in the Middle East. In the past week, optimism over a peace deal between Iran and the US bolstered it back above the short-term 25-day EMA. However, heightened tensions over the Strait of Hormuz blockade, especially after utterances made by both parties over the weekend, are lowering the risk appetite. 

On the one hand, Pakistan is striving to have the two parties agree to a second round of peace talks this week. However, Iran has indicated that it will not be sending its delegates to the negotiations. 

On Monday, the spokesman of the Iranian Ministry of Foreign Affairs stated that the US has “violated the ceasefire from the beginning of its implementation”. This follows the blockade of the Strait of Hormuz by the US navy and the capture of an Iranian container ship by the US military. On his part, Trump has renewed his threats to bomb Iran’s energy facilities. 

These tough stances have investors returning to the safety of the US dollar. However, they are not oblivious to the possibility of a peace deal between the US and Iran. With the fragile ceasefire set to expire on Wednesday, precious and industrial metals will likely remain range-bound. Similarly, the wait-and-see is set to curb the Treasury yields and US dollar’s upside. 

Platinum price technical analysis

Platinum price chart | Source: TradingView

On Monday, platinum price held steady above the short-term 25-day EMA and medium-term 50-day EMA as seen on its daily trading chart. Since the start of last week, the metal has been trading within a tight range as investors keep an eye on the geopolitical conflicts in the Middle East. 

With the crumbling ceasefire agreement and signs of fresh combat, platinum price lacks enough bullish momentum to rally past the bullish trendline that had offered steady support for months. Infact, on Monday, it pulled back from its intraday high of $2,130. At the time of writing, the platinum price was trading at $2,078 after hitting a one-month high at $2,166 in the previous session. 

A look at both the technicals and fundamentals signal that the market will likely remain range-bound in the near term. With that, the tight range between the 25-day EMA at $2,047 $2,150 and the resistance zone of $2,130 is worth watching in the immediate term. With further gains, platinum price may face resistance at $2,166 as the bullish trendline continues to curb its upside. On the flip side, resumed combat may push the metal back to last week’s level at $2,010.