Investors notice when prices rise or fall quickly, but markets work in a way that trends alternate with periods of consolidation and vice versa. Could platinum surge after a long period of stagnation? Let’s discuss it and make a trading plan.
The article covers the following subjects:
Major Takeaways
- The platinum market will face a shortage for the third year in a row.
- The euro’s rally shores XPTUSD up.
- Capital shifting from gold ETFs could lend a helping hand to platinum.
- A rise in XPTUSD prices to 1,000 and 1,035 would be a signal to sell.
Monthly Fundamental Forecast for Platinum
Still waters run deep. While gold enjoys a rapid rally, platinum remains in the shadows. For most of the past year, XPTUSD prices have stayed within a trading range of $900–1,050 per ounce. However, a gradual cooling of investor interest in the leading precious metal and major economic shifts in Europe could work wonders.
According to the World Platinum Investment Council (WPIC), the metal’s shortage in 2025 will reach 848,000 ounces, higher than the previously expected 539,000. This marks the third consecutive year of demand exceeding supply, laying the foundation for an XPTUSD rally. In 2024, the deficit was 995,000 ounces.
Platinum Market’s Balance Evolution
Source: WPIC.
The WPIC believes the situation in mining and scrap recycling is so deplorable that no geopolitical or economic uncertainties can pull the platinum market out of its negative balance. The organization forecasts a 5% drop in mining output and a 4% reduction in supply in 2025.
Meanwhile, demand remains steady in automotive catalysts and jewelry. However, industrial demand for the metal may fall by 14%. The same 14% decline is expected for investments, though their 77% growth in 2024 suggests continued strong interest in coins, bars, and ETFs.
The longer gold struggles to hit $3,000 per ounce, the more investors will doubt it will happen. As a result, ETF enthusiasts may start looking for alternatives, and undervalued platinum could be an appealing choice. Its correlation with the euro, driven by high demand from Europe’s automotive sector, adds another reason for optimism.
Platinum and EURUSD Trends
Source: Trading Economics.
In reality, platinum reacts strongly to U.S. protectionist policies. In January, XPTUSD prices rose as markets grew confident that Donald Trump’s threats were part of a negotiation strategy. But once the White House began actively imposing import tariffs, the precious metal lost its footing.
This mirrors events from 2017–2018, during Trump’s first term. In his first year, platinum entered a long consolidation phase; in the second, it collapsed due to trade wars. History is repeating itself, and the bullish momentum in XPTUSD — fueled by a physical market deficit, a stronger euro, and capital shifting from gold-focused ETFs — will unlikely last long.
Platinum Trading Plan for the Month
With this in mind, a combined strategy for platinum makes sense: buy the metal, targeting $1,000 and $1,035 per ounce. Close longs and switch to short positions if a U.S.-EU trade war begins. The trigger for this will be the White House imposing tariffs on Europe.
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
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteFinance broker. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2014/65/EU.
According to copyright law, this article is considered intellectual property, which includes a prohibition on copying and distributing it without consent.
Feed from Litefinance.com