We have covered SQM off and on for maybe a couple of years now and small Lithium play LAC for the last year or so. Today let’s take a look at a large Lithium producer that has corrected hard and appears to be setting a short-term low.
The prerequisite would be for anyone interested to thoroughly review the supply/demand dynamics for Lithium, which are complicated and the object of debate. On the plus side, ALB is diversified in specialty chemicals and materials beyond Lithium. But I’ll bet much of its previous valuation was driven by the Lithium tout into 2017.
The daily chart is poking above resistance today after climbing above the SMA 50. The moving averages are trending down so this would only be a bounce play in my opinion. But the pattern targets 117 or so, and that happens to be right where the SMA 200 resides. So if you think the Lithium patch is going to get a tout (LAC, which we’ve been noting in NFTRH, has burst upward this week while SQM remains constructive) you might want to consider looking into ALB.
The weekly chart shows that ALB found support at a lateral cluster and the 50% Fib retrace level. The daily chart above should direct things in the short-term. If it is to bounce to target the break above noted resistance will hold. If not, it will fail. So that is a tight stop loss. If I consider buying it I would hope to get a little pullback to the 103s.
Weekly MACD and RSI are in the red and the stock is down trending. Hence our view of a bounce, not a new bull phase.
Just an FYI for anyone interested in the Lithiums.
A reminder that chart based NFTRH+ updates are technical trade setup ideas, which may not be revisited as the buy, sell, stop parameters are already noted. They are meant as a starting point for your further research if interested. I will not personally buy every item highlighted and will sometimes sell (ref. Trade Log) any item that I do buy below target (assuming I’ve not stopped out or sold for some other reason), which is something I often do as a trader. Also please be aware that I am not a fundamental stock analyst. Due diligence is your responsibility.