The market is horrible right now.. junior / exploration miners getting no love.. we are tanking with the AUD even though it makes us more profitable (even for African miners!).
So miserable i can see why sentiment on the ASX is low, and this breeds more selling as people don't like what they see.. Hopefully it turns around but sooner or later the Australian Stock Exchange should have some kind of rally.. after GFC we got left in the dust.. that one lithium sector rise last year seems to have been the only cash injection in this well depressed materials sector.
I think the double bottom is in for Lithium prices at around the 125 level.. its at that stage now where if we don't bounce we may fall through support and be exposed to further lithium price downside at 115 / 110.
I predict an excess demand over supply to be in full effect by the end of the year again driving a supply side squeeze pushing the price up to equilibrium supply, and longer term give the EV revolution is in it's infancy and the inability for new mining operations to come online that there will continue to be a supply deficit for the metal which will ensure a robust lithium price.
I don't for a second believe JP Morgan predicting a steady decline in the lithium price as what we now and the expectation modelling reveal the exact opposite as spelt out above.. we are looking at huge consumer uptake with many producers not yet offering a full range of EV's.. basically its exponential growth from here so one can expect the same for lithium demand..
Short of a worldwide depression (there will be a huge under-supply situation coming into play in the medium term which can ONLY mean robust / strong lithium prices ensured!
AVZ may be required to fill this demand.. the planet will likely need this resource else the fulfillment of auto manufacturers and the likely will struggle to get the raw materials required to meet there self mandated goals to produce X amount of EV's by 202# will never eventuate and id hazard a guess no car producer wants to be left behind in the EV revolution.
Once EV's become the norm, Lithium will have the hegemony for 10+ years.. only when Graphene super-capacitors can be introduced will we see a potential disruptor.. and until then we can expect the average battery to contain MORE lithium than is currently the case.
Short term.. no sentiment
Medium term .. bullish
Long term.. uber bullish
Longer term .. uber bullish, consider investing in Graphene super-capacitors for exposure!
(20min delay)