A good rise, now a pause, something not right?..
From a weekly perspective, AGY had decent gain, moved from 3.8 to 4.1. But to be honest, not a very convincing and confident play, though that could change.
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So what is happening? Turbulent times. Volatility has increased considerably. Greed and fear alternating. Punters confused. US Li stocks had a reasonable increase. Most stocks around 40 %above their lows, and they have kept the gain they made recently. ASX Li stocks doing the same. Chinese Li stocks were lagging previously. So they did 3 consecutive 10% increase days. Caught up to others. After that they had to hold like US Li. But they are not playing the game. Lost 10% yesterday. Another 6 to 8% today. So not a good sign. I have always said that for sustained increase, we need all Li stocks to go in tandem. As I have been writing, we cannot have a party, without Chinese Li stocks. They can lag for short periods, but then have to catch up. But they are playing truant again. Not completely given up the gain, but looking very vulnerable. So now we have a question mark on the rally. Next few days may provide more than direction, but a caution sign has been given.
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AGY too is playing the macro. And playing like most ASX Li stocks. Reached high of 4.2. Last week I had written, that for AGY to move into another phase, it needs to decisively cross 4.1. It didn't this week. But is not playing weak, like it will go to 3. So a waiting game. Either macros, some big buyer or some news of its own may help.
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Personally I did not like the Chinese play. I play trading pattern, number, etc, and something didn't look right to me. Last week I wrote I have reduced my holdings considerably and only holding small. Have not yet bought back, waiting for that break of 4.1
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So what may happen next week? A lot depends on tonight. Till now, from bottom, the play has been that US Li stocks have taken the lead, went ahead, and kept the gain. Chinese Li stocks have then caught up. Last week, ALB was pushed down whole week, but it held 94. And then bang on Friday, it moved to 102. Same play this week. Whole week has been pushed down, but has held 102, even when Chinese stocks dropped 10% yesterday. We need another bang, maybe tonight, and straight to 110+, more importantly, above my number 106. Chinese stocks can catch up next week. Will that happen? Let's hope so. Enjoy your weekend and all the best.
