Mining Stock Support and Resistance: Platinum Group Metals

Includes: PAL, SWC
by: Zecco

By Richard Bloch

In a comment on my post about metal prices as potential support and resistance, WPSPIKER said in part:

I’m by no means a god bug but also don’t see a lot of upside in Gold and limited upside in copper, Silver has some way to go and Platinum & palladium seems to be undervalued slightly vs the industrial requirements … I would LOVE to see a similar charts for PAL , SWC and a few others that are in to the Platinum group metals. you by chance have those available?

Here are a few charts that show stock prices for both North American Palladium (NYSEMKT:PAL) and Stillwater Mining (NYSE:SWC) plotted against the price of both platinum and palladium (two of the platinum group metals) from January 2009 to November 18, 2010.

The red lines show the linear regression which best fits the data. I added the green lines to show potential support and resistance points. The R-squared value shows the strength of the correlation. (A value of 1 represents a perfect correlation.)

As far as the metal prices themselves, palladium is at multi-year highs, while platinum is still below the high it set in early 2008.

See my previous post to take a look at potential support and resistance points for some of the major gold, silver, and copper miners.

Important Notes

Charts of historical correlation data are for illustrative purposes only, and should not be construed as recommendations, projections, or guarantees of performance.

Disclosure: None