Platinum price is up more than 20% YTD. Here are the next targets

By: Stanko Iliev
Stanko Iliev
Stanko dedicates himself to providing investors with relevant information they can use to make investment decisions. He loves the… read more.
on Feb 20, 2021
  • Platinum has advanced above the $1300 level this February
  • If the price jumps above $1350, the next target could be around $1400
  • If the price falls below $1200, it would be a firm "sell" signal, and we have the open way to $1100

Platinum price has advanced from $1050 above $1300 since the beginning of January, and the current price stands around $1270. The prospect that more government spending will drive higher growth keeps the market in a positive mood, but the business activity is still far away from pre-Covid-19 levels.

Fundamental analysis: The pandemic is still the main drag for an economic comeback

Platinum has advanced above the $1300 level this February, supported by the expectations that COVID-19 vaccines will end this pandemic crisis. As more people get vaccinated, economic activities will start to recover while the further stimulus expectations also helped improve the market sentiment.

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“Optimism on the outlook for industrial and car demand, more stringent emission regulations and, in the last couple of days, some weakness in the dollar” have driven Platinum higher, said ABN Amro precious metals strategist Georgette Boele, and “longer-term, there is much more potential” for the price to rise.

Increasing vaccinations will help the economy to recover however the pandemic is still the main drag for an economic comeback. The US Federal Reserve and the European Central Bank announced last week that they would support the economy as long as the pandemic keeps taking its toll on economic progress.

Details of a possible $1.9 trillion package are still being worked out, and investors are waiting for any news related to a stimulus package in the US. Disappointing economic data, like weaker-than-expected jobless claims, continue to be dismissed, and stock markets continue to trade near record levels.

A strong start for world equities in 2021 has prompted the market analysts to flag worries about pricey assets, and according to Bank of America, there is irrational exuberance on Wall Street. The technical picture implies that the Platinum price may increase even more in the upcoming weeks, but if the US stock market enters a correction phase, this precious metal could be again below $1000.

Technical analysis: Bulls remain in control of price

According to analysts, the demand will exceed supply this year, which is another indication that Platinum’s price could increase even more. Platinum price is expected to continue to be supported over the long-run, but if the US stock market enters a correction phase, this precious metal could be again below $1000.

Data source: tradingview.com

The current resistance levels are $1300, $1350, and $1400; $1200 and $1100 represent the current support levels. If the price jumps above $1350, it would be a signal to trade Platinum, and we have the open way to $1400.

Rising above $1400 supports the bullish trend, but if the price falls below $1200, it would be a firm “sell” signal, and we have the open way to $1100.

Summary

Platinum has advanced above the $1300 level this February, supported by the expectations that COVID-19 vaccines will end this pandemic crisis. Platinum is about 15-20 times scarcer than gold, and according to analysts, the demand will exceed supply this year. The technical picture implies that the Platinum price may increase even more in the upcoming weeks, but if the US stock market enters a correction phase, this precious metal could be again below $1000.

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