Although XPTUSD quotes have been rising faster than XAUUSD and XAGUSD, platinum has long remained in the shadow of gold and silver. By late October, however, the situation changed as investors began seeking alternatives and found one in the white metal. Let's discuss it and make a trading plan.
The article covers the following subjects:
Major Takeaways
- The gold bubble may have burst.
- Investors are looking for alternatives to XAUUSD and XAGUSD.
- A tug-of-war over platinum is unfolding between London and New York.
- Buying XPTUSD with targets of around 1,800 remains relevant.
Monthly Fundamental Forecast for Platinum
Buy, sell, or look elsewhere? The collapse in precious metals has left investors puzzled. Gold dropped by 6%, sparking talk of a burst bubble. Recently, XAUUSD has been rising almost parabolically, but history has shown many times that assets that climb too fast often end up crashing. While the bulls are slowly recovering and continue to advocate for buying, some investors are turning their attention to platinum.
Aggressive bull markets are inherently unstable at their final, extreme phase. The Nasdaq Composite in 1999 and the Shanghai Composite in 2007 both managed to rebound after heavy sell-offs. Yet it was that dramatic collapse which first signaled an impending reversal of the uptrend. Gold seems to be following a similar path, which could be a reason to sell it on rallies.
Stock Index and Gold Dynamics
Source: Bloomberg.
Gold bulls battered by the crash are slowly regaining confidence, insisting that nothing has really changed — the "devaluation trade" remains in play, central bank appetite for bullion is still strong, US public debt is not going anywhere, and gold ETF holdings have climbed to their highest levels since early 2022. Still, they are far from record highs, leaving room for further growth.
Gold ETF Dynamics
Source: Bloomberg.
So, what to do with gold — sell it like a popped bubble or buy the dip? Some investors are choosing a third option: turning to platinum. After its recent drop, platinum posted its strongest daily gain since 2020. Prices in London rose faster than in New York, and the futures spread between the two financial centers widened from $28 to $53 per ounce.
The situation resembles the battle for physical silver before its price soared to record highs. Investors now fear a potential platinum shortage, which is surprising, considering that China exported around 140,000 ounces of platinum products in September, the highest monthly figure on record.
As platinum's lower price makes it more attractive for jewelers, worries about bubbles in gold and silver should continue to support XPTUSD's rally. While investors remain uncertain about other precious metals, the white metal could be the one to benefit.
Monthly Trading Plan for XPTUSD
As long as prices hold above $1,615 per ounce, it makes sense to buy platinum, targeting the previously mentioned level of $1,800. Whether XPTUSD bulls can reach this goal will depend partly on gold's behavior. Has the XAUUSD bubble really burst, or is this pullback simply a chance to buy the metal at a lower price?
This forecast is based on the analysis of fundamental factors, including official statements from financial institutions and regulators, various geopolitical and economic developments, and statistical data. Historical market data are also considered.
Price chart of XPTUSD in real time mode
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