Platinum is a highly valued precious metal that has been used for centuries in various industries. It is rarer than gold, which is why it is more expensive. In fact, in 2008, platinum was more than double the price of gold. The historical average ratio of platinum to gold is 1.25, meaning that one ounce of platinum is worth 1.25 ounces of gold.
Over the last two decades, the price of platinum has been a rollercoaster ride. At the beginning of the 2000s, platinum was trading at around $400 per ounce. By 2008, it had reached an all-time high of $2,300 per ounce due to supply disruptions in South Africa, which is responsible for 70% of global platinum production. However, after the global financial crisis, the price of platinum dropped significantly and has struggled to recover since then.
Recently, investment bank UBS readjusted its price forecast for platinum in 2023, estimating that the precious metal will cost $1,150 per ounce for June. This is a significant increase from their previous forecast of $950 per ounce. UBS cited the growing demand for platinum in the automotive industry as a key driver of the price increase. Platinum is used in catalytic converters, which reduce emissions from vehicles.
While the price of platinum has been relatively stagnant in recent years, there are some analysts who believe that it could move higher in the near future. One such analyst is Bart Melek, head of commodity strategy at TD Securities. He believes that platinum prices could move higher due to a "resilient U.S. economy and job market, and expectations of increased demand from China."
In the short term, the price of platinum has been experiencing some volatility. The metal lost positive momentum to form a temporary negative rebound and test the 50% Fibonacci level at 955.00. However, it has since held above this level. Platinum price also formed a new negative wave, keeping negative stability below the 965.00 barrier and achieving some negative targets.
Despite this short-term volatility, platinum price is still affected by stochastic positivity, repeating the fluctuation near the 965.00 barrier and postponing the bearish scenario. The metal also formed a positive rebound after touching the 907.00 level, affected by stochastic exit from the oversold areas.
In terms of investing in platinum, there are a few options available. One option is to invest in physical platinum, such as buying coins or bars. Another option is to invest in platinum ETFs or mutual funds. These investment vehicles allow investors to access the platinum market without having to physically own the metal.
In conclusion, the price of platinum has had a tumultuous history over the last two decades, but recent forecasts suggest that it could be on the rise again. Investment bank UBS has readjusted its price forecast for 2023, citing growing demand in the automotive industry as a key driver. While there is still some short-term volatility, some analysts believe that platinum prices could move higher in the near future. Investors have several options for investing in platinum, including physical metal or ETFs/mutual funds.
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