The platinum markets are one that a lot of people avoid because of the lack of liquidity from time to time. However, more and more brokers are allowing you to trade via the CFD market, or options, making it a much more accessible market to the retail public. What most people don’t understand is that platinum is highly correlated to silver, so while you may or may not have the appropriate technical setup in the silver market, platinum can offer another route to profits.
As you can see, the Friday market fell initially but found support at the $1500 an ounce level. This of course is a major round number, so it makes sense that the market respected it as a potential support level. On top of that, you can see that I drew a couple of lines on the chart to show signs of an ascending triangle been broken out with the $1490 level as the previous resistance. Now that we have tested it for support, it makes sense of the markets ready to go higher.
Nice trending market.
The market is obviously trending, so that being the case the market is “buy only” at this point in time, and as a result I am very bullish of the market overall. One thing you have to keep in mind about platinum is that it not only offers the protection of a precious metal when it comes to interest rates, but it also offers a bit of an industrial metal component to it as well, as platinum is highly correlated to the auto markets at times.
That being said, the one thing that is obvious about this chart is that we have broken out over the last week or so, so really there’s no reason to argue with why the market would go higher or lower. Technically speaking, this is a market that should continue to go higher, and therefore I believe that buying this market on dips will continue to offer nice buying opportunities for the bullish out there. If you have never traded platinum before, perhaps it’s time that you take a look at it.
