Thoughts on AGY for the next few months...
With the expectation of commencing steady state operations in roughly 4 months time, I could potentially see the chart playing out like this....
It's been respecting the channel since October 2021, being cognisant of the macro events affecting the markets for the last 12 months.
We have an open gap at 71c which I expect will close next week with the rejection off the top of the channel this week.
Then we find support in the middle of the channel around the 68-70c level where I'd expect the whales that have been involved over the last few weeks will get really hungry, leading to a reversal and another breakout through the old ATH of 80.5c.
With the incredible fundamentals and news flow expected round this time, that should give it the momentum to break through the top of the channel resistance early March and continue its "march" up to test around 85-90c. Would expect this to occur on big volume.
A retrace at that point would be healthy to retest the newly formed channel support and clean out the new FOMO retailers that bought the channel breakout. Slight fakeout dip back into the channel before a bounce and then continue the channel breakout towards the $1 level mid year.
Where to after it cracks through the $1? What is expected mid year?
A steady state continuous operating plant producing 2,000tpa of product that can currently be sold for US$76,000 per tonne. Not too many opportunities like this on the ASX currently in this tough macro environment. When you factor in the forward looking calculations and estimates from EBITDA models, especially when including future expansion plans, this is something that instos/funds will want to have a piece of.
Maybe we get a parabolic blow off top move at that point before a heathy consolidation, which hopefully should start to bring on more institutional buying that take it up to the next level.
Although this should be a transformational 6-12 months for this company, the next few years are looking truly astonishing. If you can't tell, I'm fairly bullish!
(20min delay)