RHODIUM TRADING THOUGHTS is about timely and profitable trading of precious metals. We do not believe every turn in the market can be called. Our goal is that our recommendations should be profitable. Profits are the goals, not trades. Do not expect all recommendations to be profitable. No system can achieve that lofty goal. Our goal is simply to state whether conditions for a metal are favorable or not. Buy signals are issued when appropriate. These signals are generally speaking for day they are issued. If price remains below signal price, buying can be done. Do Not Buy signals are given when market is over bought, and buying is unwise. Blue triangles indicate an over bought condition. These would not be good times to buy, so they are labeled Do Not Buy. Software is not showing complete legend, for some reason.
Given some adverse short-term developments, Rhodium has held up quite well. Japanese earthquake is having some impact on automobile production. Rhodium is one of the catalysts used in converters in the auto industry.
High oil prices do not help auto sales, and reduce economic activity in total. High oil prices act on the consumer like a tax at the gasoline pump. Given that oil demand is weakening in many places, that might be a transitory event. Further, while Western auto sales might slow, those in China and India will continue toward repetitive annual new highs.
Given these two adverse influences Rhodium price has slipped only modestly. As the top chart indicates, Rhodium is deeply oversold. Any modest upward movement in price would likely bring buyers into the market. At the present time buyers are complacent and still relying on previously purchased inventory. Both of those will eventually come to an end.
Rhodium, as suggested by the second chart, is deeply over sold relative to $Gold. This level of over sold has in the past indicated a bottoming in the price of Rhodium. Relative to Silver, which is grossly over valued and trading in a bubble, Rhodium is a much preferred choice.
OPINION:
Rhodium has the potential to benefit from under valuation, as shown in the table below. Rh is also deeply over sold, and building a long base on which to move higher. Investors continue to have an opportunity to add to Rhodium at what appears to be an attractive long-term price. Further, the speculative bubble in Silver, the over valuation of Silver, and the massive over supply of Silver developing all provide investors owning Silver extremely cheap money with which to buy Rhodium. Investors should SELL Silver and buy Rhodium.
$Rh Preliminary Price Valuation Range | |||
US$ Rh Current | Valuation | $Valuation | Potential % Change |
$2,300 | Over | $7,500 | 226% |
$2,300 | Fair | $6,000 | 161% |
$2,300 | Under | $4,500 | 96% |
US$ SILVER Valuation | |||
US$Ag Current | Valuation | $Valuation | Potential % Change |
$42.70 | Sell Target | $35.50 | -17% |
$42.70 | Long-Term Target | $33.00 | -23% |
$42.70 | Fair Value | $15.60 | -63% |
We get mail from many on Rhodium plays, which are about as plentiful as cool water in the Australian outback in the middle of Summer. However, we may have come across one that may be a way of benefitting from Rhodium's potential and high prices for other precious metals, as well as some other interesting technologies. No direct pure plays will ever exist as Rhodium simply does not accumulate in the earth in sufficient concentrations. That is why it is considered rare.
Raptor Technologies is a company investors should research. This is not a buy recommendation as we do not know enough about the company. This is a recommendation to do some research on the company. Web site is www.raptortechnologygroup.com Stock is USOTCBB: RAPT.
Your Eternal Optimist,
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