Potential signal:
- I am buying Platinum on a break of the $1826 level in the futures contract, with a $10 stop loss, and a $18 target.
- Platinum continues to be a grinder of a market, but with the Fed coming out with an interest rate decision today, it could start picking up momentum.
Platinum
Platinum stabilized during Wednesday’s trading session as traders paid close attention to the U.S. 10-year yield, which slipped below the 5% level again. Furthermore, we also have to keep in mind that the Federal Reserve has an interest rate decision coming out later in the day, and that could come into play as well.
Ultimately, traders are expecting a 25-basis-point rate hike, but it will be the conversation afterward during the press conference and the statement that traders will be parsing more than anything else to get a read on where interest rates might be going. Falling yields could put more of a bullish bias in this market, and if yields really start to come off, then that could be a major boon for platinum.
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Keep in mind, though, the market has been consolidating for a while
A bounce from here could just send the market back toward the $1,900 level, where it has faced some problems recently. The platinum market does tend to follow silver in general, so keep an eye on that as well.
For what it’s worth, the stochastic oscillator is crossing, but it is at the 35 level, not at oversold conditions, so that in and of itself is not necessarily a signal. When I look at the chart, it’s easy to see that the 200-day EMA is clearly flat, right along with the 50-day EMA. This suggests that maybe there is not a lot of momentum in the market at the moment.
However, if platinum were to cross the $1,825 level, that might be a signal for a short-term long opportunity in this market, as platinum tends to be a little bit quieter than silver. It might be a safer play.
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