These Extreme Setups Could Send Platinum and Palladium Soaring

Gold was the big winner among precious metals in 2024. It absolutely soared... outperforming stocks in the process.

Most investors missed the rally. And that's why gold could keep moving higher this year. But two other precious metals are poised for even bigger gains.

Yesterday, I explained why platinum and palladium could crush gold in 2025. It's simple supply and demand.

But the story is bigger than just that. You see, prices have stretched too far... And history shows they're poised for a dramatic snapback.

Today, we're taking a closer look at both platinum and palladium. And as you'll see, the extreme situations in place for both metals could push them dramatically higher.

"It's more precious than gold"...

That was once platinum's claim to fame. For decades, it was considered rarer, more useful, and, therefore, more valuable than gold. Not anymore.

Platinum isn't just cheaper than gold right now... It's trading near the lowest discount to gold in history.

You can see this extreme setup in the chart below. It shows the price of platinum divided by the price of gold for nearly four decades. Take a look...

Platinum generally traded for more than gold during the 1990s, 2000s, and the first half of the 2010s. And at times, the premium was massive... with platinum trading for more than double the price of gold in the early to mid-2000s.

That trend fully reversed in 2015. Platinum has traded for less than gold ever since. And the discount has gotten extreme in recent months...

The only other time we saw a similar setup was in 2020. Back then, platinum traded for a 60% discount – the largest on record at the time. Here's what happened to prices next...

Platinum crushed gold over the next 11 months. It rallied 121%, while gold jumped just 24%. And platinum closed more than half of its discount to gold along the way.

Today, we're in a similar situation. Platinum is once again trading at an extreme discount to gold. That's mainly because gold has been soaring and platinum hasn't.

But going forward, that performance difference will likely flip... and platinum will outperform gold.

The setup is similar in palladium. The metal has crashed even worse than platinum in recent years. And those hefty declines have led to unbelievably negative sentiment.

We can see this by looking at the Commitment of Traders ("COT") report for palladium. This weekly report shows what futures traders are doing with their money. When these folks all agree on an outcome, the opposite tends to occur.

That makes the COT report a powerful contrarian signal. And in the case of palladium, traders have been fantastically bearish in recent years. Take a look...

The COT has been hitting bearish levels ever since the metal began crashing a few years ago. But as you can see on the right side of the chart, that drop has reversed in a big way in the past few months.

Importantly, this is the first time in years that we've seen this kind of sentiment reversal. The palladium COT report hit a new 52-week high in September. The last time that happened was in 2016.

Back then, the new breakout led to a huge boom. It helped kick off a 105% rally in the metal.

The setup today is just as good. Investors hate palladium... But that pessimism is quickly fading. That's exactly what we'd expect to see as a new boom begins.

Both of these metals are in extreme situations. Both metals languished last year as gold soared. But you shouldn't expect that to continue.

Platinum and palladium are both poised for major moves higher. And if you're a contrarian investor, you need to consider owning both in 2025.

Good investing,

Brett Eversole

P.S. Next Thursday, I'm sitting down with Rich Checkan... the chief operating officer of Asset Strategies International, one of the coin dealers we trust most. We're airing a live webinar with investment manager Adrian Day. And I hope you'll join us. We're planning to talk about the state of the stock market... the metals market... and what the Trump presidency means for both. If you're interested, click here to sign up.