A countertrend setup in platinum
Key points
- Platinum has rallied sharply earlier this year after consolidating for years
- While the long-term trend appears positive, several factors could weigh on platinum in the short term
- Both seasonality and sentiment are presently flashing yellow for this rare metal
Platinum has broken out in a huge way
Platinum spent the better part of four years consolidating into an ever-tighter price range. Then, from April to July 2025, price exploded 60% higher.
With gold leading the way, many have proclaimed "a new bull market" in metals. However, metals such as silver and platinum could continue to play "catch-up" to gold.
At the very least, platinum remains objectively in an uptrend, trading above its 70-day exponential moving average. However, counter-trend traders should remain alert for an opportunity to play the short side of this market in the weeks and months ahead.
Entering a particularly troublesome seasonal period
The chart below displays the Annual Seasonal Trend for the platinum futures and highlights the period extending from Trading Day of the Year (TDY) #176 through TDY #198. For 2025, this period extends from the close on September 4th through October 6th.
The chart below displays the hypothetical cumulative $ +(-) achieved by holding a long position in platinum futures only during this period since 1987.
The table below summarizes the results for platinum during this period.
To put this performance into perspective, the chart below displays the cumulative $ +(-) achieved by holding a long position in platinum futures:
- ONLY during Trading Day of Year #176 through #198 every year since 1987 (blue line)
- All other trading days since 1987
The bottom line: There is never any guarantee that platinum futures will fall during the TDY 176 to 198 period. But, historically speaking, this period stands out in a clearly unfavorable way from the rest of platinum's trading history.
Sentiment has also flashed a warning sign
The chart below highlights all dates when the 50-day average for our Platinum Optix indicator crossed above 50 while platinum futures were above their 150-day average.
The table below summarizes forward results. The sub 50% Win Rates and negative median returns across the board do not guarantee lower platinum prices from here. Still, they do dovetail nicely with the weak seasonal period now being entered.
Now let's turn our attention to the ABRDN Physical Platinum Shares ETF (PPLT), which started trading in 2010. The chart below highlights all dates when the 10-day average for PPLT Optix crossed above 77.7.
The table below summarizes subsequent PPLT performance.
What the research tells us…
If platinum is in the early stages of a new long-term bull market, attempting to play the short side could be risky. With that warning in place, the current combination of unfavorable seasonal and sentiment factors may present an opportunity for short-term counter-trend traders to profit from a potential consolidation in the price of platinum.