Platinum Price Charges to 6-Year High, Crude Oil Eyeing OPEC Outlook Report

Platinum, Crude Oil, S&P 500, OPEC, Commodities Briefing – Talking Points:

Platinum prices surge to about a 6-year high as USD fell
WTI crude oil prices wobbled after volatility in S&P 500
Energy prices eyeing OPEC, platinum momentum fading

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Platinum charged higher over the past 24 hours, with prices touching their highest in about 6 years. Bets of palladium’s substitution in China seemed to be driving demand for the rare metal, according to Bloomberg. Palladium is often used in catalytic converters to reduce emissions in petrol vehicles, with platinum more widely used in diesel ones. Platinum’s cheaper price relative to palladium may also be a factor here.

Meanwhile, crude oil prices wobbled as the growth-linked commodity tracked a volatile session on Wall Street. There, the S&P 500 closed out a -0.03% loss after briefly dipping as much as 1% before recovering. WTI also capitalized on a -6.6 million barrel drawdown in crude inventories last week, according to the EIA. A weaker US Dollar likely cushioned precious metal and commodity prices following recent gains.

Federal Reserve Chair Jerome Powell warned that the nation is still far from a strong labor market, reiterating that they will maintain their accommodative policy setting as the current pace of quantitative easing continues. Wall Street futures are trading cautiously higher as APAC equities follow. It should be noted that Chinese markets are offline for the new year holiday, reducing liquidity conditions and raising volatility risk.

The economic docket is fairly light heading into the remaining 24 hours, with US initial jobless claims a notable highlight. Check out the DailyFX Economic Calendar for more data and updates. Platinum may continue benefiting from the Greenback’s persistent weakness. WTI is eyeing monthly oil outlook reports from the IEA and OPEC. Improving global recovery bets could offer further upside potential for energy prices.

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Platinum Technical Analysis

After surging above 2016 peaks, platinum is eyeing the 123.6% Fibonacci extension on the daily chart below. This is as the rare metal is fast approaching the 2015 peak at 1290.30. Negative RSI divergence shows that upside momentum is fading, which can at times precede a turn lower. Should that occur, the 20-day and 50-day Simple Moving Averages (SMAs) could act as support and reinstate the focus to the upside.

Platinum Futures Daily Chart

Chart Created Using TradingView

Crude Oil Technical Analysis

WTI crude oil prices are sitting just shy of the January 20th, 2020 peak at 59.61. This is after prices extended beyond the February 20th peak. Rising support from November is maintaining the key focus to the upside, and it could come into play in the event immediate resistance holds and prices turn lower. Otherwise, further gains would expose the 2020 peak at 65.62.