Platinum – Awesome!

Being the first precious metal to breakout upwards platinum did as early as the week before last. Its rev-up happened the day when the mine workers were shot. Within the past years platinum was often the metal that turned, topped, fell or accelerated first of the four precious metals. So newly it is the one we have to quote implicitly to classify the expected gold and silver rally in terms of pricing and timing.

Bill Wolfe and Brian Wolfe are the discoverers of the Wolfe Waves patterns. A Wolfe Wave (WW) is a predictive pattern used in technical analysis. Die WW is a natural rhythm of the markets that is found in all time frames. There’s a Bearish WW and a Bullish WW.

On the basis of certain wave formations in the past the pattern puts out pretty exact future price and time targets. It’s a very reliable pattern. When I identify one while trading I’m always delighted for the pattern is met at a T with an 80 per cent of probability according to my experience.

Here’s the exact definition of the Bullish WW:

Source: http://www.wolfewave.com/an_illustration_along_with_the_rules.htm

The daily platinum now produced a perfect Bullish WW during its consolidation, absolutely according to the rules. Frequently the starting sequence is difficult to identify because it may show quite a few derivations from the perfect setup structure. In this case it isn’t, the points 1-5 are showing the perfect wave structure. Very rarely the patterns develop in the daily time frame. It’s really a big present for any trader and investor:

You see, from the temporal point of view the upper intersects the lower trendline by the end of February 2013. For the moment that’s the most important for me. The time is pointing to the aspect that besides gold also platinum is supported by bullish forces through the end of February.

At least for the moment I can’t cope with the probable consequences of this Bullish WW respecting the Estimated Price at Arrival (EPA). Is that really possible? The platinum all-time high is at 2308.80; depending on how gold and silver are going to perform during the coming months in relation to platinum we’ll have to reckon "merely theoretically" with gold and silver newly reaching the all-time highs until February.

If the actual gold/platinum relation keeps continuing in February 2013 gold would be quoted at 2300 or so in case platinum is at 2200. But maybe this possible platinum rise is already suggesting the QE3 – or just the expectation of the market that the platinum supply is going to run short extremely in the coming months… But even if a shortage of supply of platinum is expected in this narrow market gold and silver will have to follow platinum upwards possibly reaching 2000$ or 40$ respectively until February.

At any rate all the precious metals may explode now – and the Bullish WW is backing this theory. This might become the trade of the year. The monster up-wave might come not being able to top before February. It’s time to load the boat. And during the profound corrections refueling is a MUST!