Yahoo Finance Platinum and Palladium Surged on Thursday, April 28
How Inaction from the Major Global Banks Affected Precious Metals
Platinum and palladium surged
The haven bids at the beginning of 2016 leaned toward gold and silver, whereas platinum and palladium remained rather slow to pick up. Although platinum and palladium are also precious metals, the haven bids for them are comparatively low.
These two metals are heavily used as industrial metals. The changes in automobile demand heavily affect these metals, just as the issues affecting the giant vehicle manufacturer, Volkswagen, substantially influenced the price changes in these two metals.
Platinum and palladium both have seen a rise of 18.8% and 11.6%, respectively, since the beginning of the new year. These gains are following the massive gold and silver increases of 20.2% and 28.3%, respectively.
Platinum and palladium outperformed gold and silver on Thursday and rose by 2.6% and 2.4%, respectively. Palladium rose by 9.5% during the last 30 trading days. These two precious industrial metals are trading at $1,050.70 per ounce and $624.40 per ounce, respectively.
The fluctuations in platinum and palladium can also be studied with funds like the Physical Platinum Shares ETF (PPLT) and the Physical Palladium Shares ETF (PALL).
Cross rates
The relative movement in platinum and palladium can also be studied by the way of cross-commodity rates, including gold. The gold-platinum and gold-palladium spread, or ratio, measures the number of platinum or palladium ounces it takes to buy a single ounce of gold.
The gold-platinum and gold-palladium spreads are 1.2 and 2, respectively as of April 27, 2016. The RSI (relative strength indicator) levels for these two ratios are 31 and 30, respectively. RSI levels above 70 often indicate overvaluation, while those below 30 indicate undervaluation.
The changes in the precious metal prices also impact investments in shares of mining companies like AngloGold Ashanti (AU), Royal Gold (RGLD), and Primero Mining (PPP).
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