A year ago I wrote about the platinum/palladium ratio as it was on the edge, and there were two possible options, to restore the historically normal supremacy of platinum (target 1.93 oz) or to prolong the triumph of palladium (target 0.56 oz.).
This month the Platinum/Palladium ratio hit a new record low of 0.55 oz. amid the rocket move to the upside in the palladium market; the latter became the most precious metal beating gold. Let’s take a look at the big picture below.
Chart 1. Platinum/Palladium Ratio Monthly: New Record Low
The chart above starts with a robust growth to the upside from 3 to 5 oz. and this move had set the “normal” range for the fluctuations of the ratio within the next two decades. It was interrupted only once in 1997 when the ratio fell out of the range and quickly dropped to establish a previous record low of 0.56 oz. in 2001 amid rumors that Russia would ban palladium export. It was a textbook example of a “sell rumors - buy facts” market behavior, the ratio was down on rumors and then when the reality didn’t confirm it the ratio quickly returned to the normal range making a beautiful V-shape pattern. Then the ratio had spent another decade in that range. Continue reading "Palladium Pushed Platinum To Record Low"