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TDS constructive on Platinum but offers caution

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NEW YORK (Scrap Register): TD Securities said it’s upbeat about the longer-term outlook for platinum but said it may take more time before prices move meaningfully higher.

Platinum is 10% higher for the year so far, with spot metal trading at $876.75 an ounce. The metal is softer early Monday but benefitted recently from a round of short covering.

“While we are constructive on platinum, particularly given its favorable long-term fundamentals and ultra-low valuation, we suspect the market will need to acquire more certainty that cyclical headwinds are in the rearview before prices can revert meaningfully higher,” TDS noted.

“As prices broke north of the $900 an ounce mark, discretionary shorts were also forced to cover, which has brought net length back to the historical range. However, with short positioning nearing multi-year lows, the absence of a marginal buyer could see prices revert lower in the near term,” TDS added. 

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