Signs of extreme upside asymmetry are playing out in Platinum markets, TDS Senior Commodity Strategist Daniel Ghali notes.

CTAs to buy 5% of their max size this session

“We highlighted that even a small reversal in prices can now spark massive CTA buying activity in Platinum markets over the coming week, and today's price action should help to spark the first such CTA buying program. We expect CTAs to buy 5% of their max size this session, which represents only a fraction of the total +60% they could plausibly buy over the coming sessions in an uptape.”

“At current levels, even in a flat tape, CTAs would be set to completely cover their shorts over the coming week. This set-up for algo flows bodes very well for additional upside on the horizon, reinforcing our view that Platinum prices have now already printed their local lows.”

“A substantial increase in SGE Platinum volumes amid the recent slump further suggests dip buyers have emerged in physical markets, in line with our view.”