No. I've already tried to explain this to you. LIT is following the pattern of AKE (and the other major players). LIT is based off the share price movements of the stocks not the other way around as it is comprised of the stocks themselves. What drives the stocks in the short term? The Li spot prices, with periodic interception by individual companies surprising the market with an announcement that varies from expectations. Trade multiple Li stocks in real time as I do and you will see them respond in the same direction in a cascade. CXO usually responds ahead by a day or two (it used to be NMT, but not anymore), it is moderated heavily within a range so it is directional only and is currently the most heavily shorted stock of the group (11%) so it tends to be heavilly traded in both directions, but intraday it is usually AKE that moves first (it used to be PLS but not now), AKE is only lightly shorted (now about .7%, but rising slightly at this point, whereas a month ago the % was declining). Shorting is how the stock moves when it appears to move against the longer term FA expectation, or when being arbitraged against another linked stock, but unless it is being driven by a major stuff up (like CXO) the shorting cycle may be only a day or so with the shorters buying back within a day or two of their selling, and then repeating the process as needed particularly where they are merely price discovering or fine tuning a price that they have already set, its not so much the level that matters but how it changes over a few days. This is particularly the case with AKE at the moment as it is coupled to LTHM, and in fact when two companies are coupled like this generally only one is the short target while the other acts as the hedge. We saw this with GXY & OKE where the shorts went against OKE and the buys went to GXY and they would arbitrage across the two as the market tried to equalise them. During that period a lot of us were watching that and trading across the coupling, so we would buy or sell one or the other depending on who was getting the attention that day from the institutions. I would suggest that that is possibly what we are seeing now between LTHM & AKE, LTHM is being pushed down while AKE is the arbitrage hedge for the shorts.
This is the comparison chart of AKE (orange line) against LTHM (the candles). Obviously (given all my scribbles on the LTHM chart) I am tracking these daily (in fact intraday). The blue arrows, with the rising one going off the top is where I expected LTHM to start rising, but that is because I was expecting the Li prices to start rising, but they continued to fall instead, after a brief recovery. Note that AKE and LTHM are tracking eachother almost perfectly, but also note that when the merger was announced, AKE and LTHM swapped places with AKE getting an instant revaluation against LTHM going from below LTHM to above, reflecting the almost immediate change in their status with AKE becoming the buy hedge for LTHM. Note also LTHM was in a long term rising wedge from which it recently broke. The rising channel I have drawn in on the LTHM candles for the last couple of days is almost exactly the TA predicted end point of the break in that rising wedge, we should see LTHM rise a bit now and AKE will follow. If the Li prices also reverse up that rise should hold, if not it will fail. Now since 2 of the three biggest components of the LIT are actually car companies, they might see a continued decline (due to ongoing shakey US economic expectations) so the LIT could easily fall more while AKE/LTHM rises in the short term.
On most days, the US market leads the Oz market (I track a small manually maintained index of equally weighted US stocks comprised of ALB, SQM, LTHM, LAC & TSLA), which gives a daily channel for Oz stocks which generally move within that predicted channel (the "US Lead" channel in the earlier post above), so on most days the US leads Oz, except at the turns where often the Oz stocks will respond first, but the Oz stocks will do their own version of that channel, maybe hanging to the top, or opening high and falling to the low when the US stocks opened low and climbed to the high, etc. The LIT is fine as an index of overall market sentiment, but it includes a lot of stuff that is hedging it as a pure Li stock predictor. It is most accurate in a boom because everything is rising, in a reset it gets a little more confused because everything does not move with the same timing. Li stocks are often hit before the manufacturers as the Li prices respond to forward expectations while the EV car manufacturers have forward orders going out months that buffer them, so stay higher for longer.
