@ccc123 I always try and fight the urge to explain violent SP movements but I can't help analysing it like yourself and trying to justify it in someway. The effect of the irrational herd, the primeval mindless brute, like Wildebeest stampeding, is my default explanation, but that can't be it here. I have noted
@anatol's fear that perhaps we are being set up for a cheap TO and other explanations. I have also noted your comment about Buldania news being poor and leaked as a possibility. That doesn't ring true to me as Buldania has never entered into valuations or serious calculations of LTR except perhaps occasionally here on HC. KV is the hero and LTR has said so. That wouldn't account for the volume either.
If you go back and read the last week or two of the AFR you will find many depressing articles on lithium pricing. The recent A40 and PLS news has just brought it to a head today and that is probably the main cause of the herd being stampeded today and then others take advantage. But the main concern, also reported some week or so ago in the AFR which I want to raise here was the decision by SQM to increase its supply and lower is prices in 2020 despite it seeing no increase in demand yet. The reason was to push prices down and to win back market share which it has lost to Australian hard rock miners which means getting them to shrink or to force them out of business if possible. Tick already. The effect of that will be to clear the way for WES/SQM Mt Holland to be very successful to fill the void and SQM can maintain its newly increased market share by undercutting the market with its lithium from brine and then replacing it in the future with Mt Holland lithium. There is nothing illegal in that plan which is very plain to see as why else would they sell lithium from brine cheaply to gain marketshare (they stated that) and then buy My Holland. Far from slowing My Holland down they will want to speed it up IMO to fill the void created by the market action which has put A40 to bed and threatened others. This SQM plan will not effect Greenbushes or Mt Marion too much, only the poorer funded or technically handicapped miners which
@anatol and
@mickvp25 have highlighted.
IMO investors have interpreted this as lithium prices will stay low for even longer than they thought, and so while accepting LTR has a great resource and is in a great position, there is no rush to buy it, neither will it re-rate soon in their opinion. Yes the prospect of a massive upgrade and TO or JV happening is still there, but they see the continued deflation of lithium prices as simply a reason not to buy LTR now or rather to sell LTR now. It is an uneducated reaction I know but many investors are surely saying that if a producing mine can go under, how will an explorer, years away from a mine survive? They have a point without fully understanding the market and LTR like the downrampers with their exploration mining chart demonstrate. So unless you want to go long LTR and believe that a player may coming knocking sooner rather than later, many small to middle investors, and maybe even some big ones will sell LTR and either watch from the sidelines or more likely invest elsewhere until lithium sentiment changes. This reason for selling LTR has been around for a while but very recent developments have brought it all to a head. That is my explanation anyway for the volume today, and of course herd mentality played its part. Having put that theory forward, am I a seller? No I am definitely not. Do I believe in LTR? Absolutely. Following the herd is the way to loose money, not make it. I have always said from the first day I posted on LTR that LTR has the same whiff about it as KDR which I was in for 2 years very happily, but what a ride that was.You needed to be very strong as is now appearing the case with LTR. LTR has better management and as good as or a better resource than 50% of KDR. It is uncommitted and its timing is even better than KDR. It can learn from others what not to do as I have said earlier today. I am settled in for a 12 month wait and still believe that the KV DFS, while promised next year will not be needed. The PFS, mets, Buldania MRE and KV upgrades will be enough for us to be in play and most likely an auction, and perhaps even sooner. However the speed at which LTR is progressing all of this indicates to me that they know all this is needed for the sale/JV best price. Hopefully the DFS will not be needed either. The only thing to stop that are world affairs with a general slowdown of the lithium story due to lack of finances worldwide.