Consolidation and back test?
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I know there are some who don't like my posts. Because I may trade, which I do often as I play level to level , or I write a lot about macro, now ALB etc. By now people would know what to expect from my post. I just put my thoughts knowing it's not for everyone. So I would suggest people who don't like my posts, please put me on Ignore, a great Hot Copper feature which will ensure people only see and read what they like. Thanks.
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Yes WR1 lost 10c to finish at 137 on a decent volume of just over 3.1m shares traded.
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Yesterday US markets did all right, SP 500 now on 5200. We got a good PPI number, which neutralised the slightly higher inflation numbers earlier. Yesterday I had written that there is a good chance ALB may finish in green based on earlier pattern, though not very big. It played out accordingly.
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ASX Li was mixed, though overall slightly soft.
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Yesterday I had written that I won't be surprised if WR1 now goes into some consolidation. It has a big rise, so I thought that would be healthy as well. So are we seeing that consolidation? I think so, but different people can have different opinion. Also it's only later we come to know, if it was consolidation or weakness. At this stage it may be individual opinion. Yesterday I had also written that if it was to back test, only number I see is around 130. But I was hoping that 140 is held. But it was not to be, with slight softness in Li stocks today not helping the cause. But still has held most of the gains, very positive. Moved from 113 to 137 on a weekly basis, so still in strong uptrend.
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So what's the play from here? I still believe that we need Li macro to be at least neutral to keep the gains and making further up moves. One of the reasons I talk about macro, ALB, etc. I know when things are going well, we get a sense of bravado, of being invincible. It can happen, but probability based on what has happened to most Li stocks including WR1 cannot be ignored. This is just my opinion. I play with caution, may not be best way to play, especially if we are on up. But after what happened in June 2022 and later, my strategy has been to minimise loss rather than maximising profit. May not be a good play, but suits my risk appetite. We all have to individually find what we are comfortable with.
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Personally Iet go my shares at average 145. My buy was average 123,as I wrote yesterday, so not a big win. But I play level to level, follow certain numbers. I know many are long term here, and many don't like when someone says they have sold. It's natural and from time to to, I get flak for that, so bracing up for another possible one. But I always try to give a picture that I may be trading, in most times even giving numbers or reasons why I would do so before hand . But still I can understand the feeling. So why did I sell? Yesterday I had written I would like 140 to hold, otherwise chance it may test 130. When it first went below 140 and then when it came back, I thought it may play here so got out then, with a good chance of 130 test. It may not happen that way, but I am playing probability. My next buy, if it goes up, around 150. If it goes down, then I will see if it holds 130, then I may buy in early to mid 130s.
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So what may happen next week? For ALB an important night coming up. Based on previous pattern when it finished in 130s, on 4th day it had a big drop towards 120. So tonight if it can hold the level, we will be at least neutral. But if it moves towards 140, lot of punters and money may come to the sector, which will bring decent gains to Li stocks including WR1. Will that happen? Let's hope so. Enjoy your weekend and all the best.
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