Sector still thinking, confused?.
From a weekly perspective, PTM moved from 44.5 to 41, so a small drop.
.
So what is happening? Last week I had written how volatility had increased, it was a very confused state. This week there was no respite on that front, volatility and confusion. US Li stocks which were holding the fort, finally succumbed to the Chinese play. Two weeks back, even on weakness ALB held 94, which was positive. Last week, after reaching 102, it held there. But this week it gave back one floor of steps, back to 94. Its still nearly 30% above its lows. I had written, we need confirmation from ALB. It has to cross 106 and stay above that. It reached 105, very close, but failed to cross the big hurdle of 106. Both Ganfeng and Tianqui also playing weak throughout the week, except today, mostly second half of today. Made some good gains today, between 3 to 5%, it was higher but gave couple percentage in last few minutes. But it has given hope. US Li may recover a bit tonight. I am not sure ALB will reach the next rung of 102 tonight. But from weekly perspective, even after today's gain. Ganfeng still lost 2.5% for the week, which is not great. Last week it had reached around 38, now sitting at 31, its low is around 25. So somewhere in middle, around 25% from its low.
.
PMT too is playing the macro. But I feel its playing average. This week a large number of ASX Li stocks gave away between 10/15% average. And PMT did the same, close. From a numbers perspective, the elusive 50 of this phase is still a target. On weakness, 38 needs to hold.
.
Personally couple of weeks back I wrote my average buy was 37. Last week I had sold half at 48. I sold rest half this week at 45, so average around 46 or so, overall I had a gain of around 25%. I was hoping to see a play into 60s, but when 50s itself was not cracked, I got spooked. Last 2 years has been brutal for the sector. So I have become defensive with Li sector play. When I don't get a strong up signal, I get out and wait. I know most are long termer, but every one's risk reward is different. My play may not e good, but suits my temperament. I had a very large Li stock holding couple of weeks back, around 11 Li stocks, it was looking great, but now a pause, some confusion, so I will wait to see how it gets resolved. I had got out around 60% Li stocks previous week. Rest mostly I got out this week. Playing Uranium now from a sector perspective.
.
So what may happen next week? Turbulent times. Mixed signals. Few weeks back, it was a very strong play. Many Li stocks rose up to 50% from their lows, even ALB, Ganfeng, many ASX Li stocks etc. But they have given back some. Most now sitting around 25/35% gains. So we still are ahead from the lows. But spot price is not great. Rio play had a good effect, now that effect wearing away. Need a catalyst or a strong price action. I feel we are in the middle (or upper half) of what was looking like a reversal. So possibilities is still good. Again want to see ALB above 106, Ganfeng above 36 - but most importantly stay above that. Till then, I feel confidence will be swaying with the ups and downs. Lets hope US Li have a good tonight on the back of Chinese play and at least get halfway back, like ALB around 98 or so. Will that happen? Let's hope so. Enjoy your weekend and all the best
(20min delay)