@GARETH78 Thats a good question regarding the shorts. If i can use an example of another stock that is currently shorted in the top 20, there has been inexplicable turnover over a long period that seems to range beyond the potential available shares that would be on hand from the top 10 shareholder (institutions). There's no doubt that it has been a masterful exercise in manipulation, what with a churn of shares cycling in and out of market to drive the price down. Now, the shorts are starting to cover with 1 million shorted shares seemingly appearing from nowhere without driving the price up.
I figure the same will occur with GXY, it may get back to a price range between $1.20-1.80 for example if they cover, but you can be assured they will cover it with minimal upside as possible. As it is they may well be ahead on their investments (likely to be substantial profits), so if they reach their intended bottom and cover with sp recovering they may have an acceptable elevated price level by which they intend to cover all shorts.
The problem I've been thinking about with GXY is they are very vulnerable, the shorts are attacking it constantly. Which suggests to me they are going to keep going after it if they churn in and out of their shorts. A lot of things have to happen before the shorts begin to leave this company, which I fear are someway off or won't eventuate at all. Cash will start to run out in 18 months if current conditions persist. If SDV is operating as a pilot program when perhaps it should have scaled up to be more attractive to an off taker regards volume and consistency, this may not generate enough interest from customers and they will still be relying on Mt Cattlin for the bulk of their revenue (which is already overproducing spodumene.)
So this puts them in a really tough spot: do they commit more of their precious cash reserves to the further development of SDV? Or do they continue as they do now hoping on a wing and a prayer the lithium price will come back up and they will be positive cashflow once more? Tough times for this company..
