The one full year chart comparison between AKE and LTHM shows more sign posts.
LTHM reached ATH sometime in September 2022 and AKE in November 2022. And recently AKE broke that ATH and reached a new ATH. But LTHM still needs to gain more than 25% to reach a new ATH.
When AKE reached ATH on 11 November 2022, the sp closed at A$16.18 and LTHM closed at US$33.62. At present AKE is at A$16.44 and LTHM is at US$28.32.
Now, if somehow that parity that happened on 11 November 2022 (A$16.18 and US$33.62) still has some technical force to affect the sp (I don't know if it does), then AKE sp will be moving sideways to allow LTHM sp to catch up. But I suppose that parity doesn't matter anymore after the merger agreement.
The question now is whether LTHM sp will be brought to reach or even break its ATH (with AKE sp is following up) as has been done by AKE recently.
If LTHM sp doesn't reach its ATH, that will give the impression that it is underperforming compared to AKE, which can jeopardize the merger. So I tend to say yes to that question. The reason for that is that those BEOTs who will reap millions of dollars as advisers for this merger will ensure that the merger is successful by making sure that LTHM is as outperforming as AKE.
Here is the technical indication for my thoughts above:
From Wyckoff schematic's point of view, what happened on 12 July, when the high of the day was higher than the high of the upthrust on 3 July, is a breach of the distribution schematic. It might be just a glitch and is being corrected. It is too early to tell whether it is a breach or a glitch. But I tend to see it as a breach, because if the sp had tracked the schematic, the pullback would have been deeper.
Another reason why I suspect that the sp has stopped tracking the Wyckoff schematic is that it is not suitable to show an outperformed stock that is trending up. To show an outperformed stock that is trending up, the simple MA or EMA is the right tool. Just as can be seen clearly on the chart above, the sp has been creeping up on the EMA 9 line and bouncing up of the EMA 21 line. It is the same with AKE.
This is just my thinking at present based on the data I can observe. New data may change my thoughts. And if this thinking is right then (I just realize) there will no UTAD as I have thought.
