Lithium

Where will all this energy go?

Copper, aluminum, uranium, gold, silver, energy stocks and are seeing a lot of bullish momentum. There is a lot of interesting overlap and intersection between all of that movement. But the main theme is new technology ( Super computers for AI, robotics, travel, humaniods, etc) are going to require a lot of energy. And that energy will need to be stored.

I do not pretend to be an expert on energy storage, but I do find the possibility of lithium batteries (and lithium related names in general) catching a possible bid here as plausible.

Make no mistake, lithium and related names have been in a nasty downtrend for a long time. And I might be totally getting this wrong. But I want to at least take a look as I have personally started positions in some of the mentioned names.

Lets first look at some general broad Lithium ETF’s and then a few names.

Vaneck Rare Earth (REMX)

The largest holding in the rare earth ETF is Arcadium Lithium PLC (which is not a pretty chart at all). But that does tell me that IF lithium turns, REMX could benefit. Also, it has broken out of a small flag after bouncing off recent lows. BUT MAKE NO MISTAKE, the long-term chart is UGLY. but sometimes, if you are not early, you are late.

Sprott Lithium Miners etf (LITP)

Miners are also ugly, but at least they are trying to break an early DTL after bouncing off the lows. They can easily roll over and continue lower, but this might be the first step to turning the corner higher.

Lithium Americas Corp (LAC) - Canada based company focused on advancing lithium projects in Argentina and Nevada

As you can see above, the weekly chart is ugly. However, it is trying to find its footing and the daily chart below looks just a little bit better

Price is trying… key word, trying, to get above the 7-7.50 dollar level. I find this important as this group has the potential to really rally, and I don’t want to be late to the party if this sector takes off again like it has in the past. So I don’t mind being early, if I can get some continued positive price action. LAC getting above some key levels noted above on the daily chart is a good start to this theme actually playing out.

Other notable names

I took this screen from a Forbes article. If you want to do dig deeper, those names might be a good start.

The article states there is a glut in the lithium battery market and they are suffering from slower adoption of EV’s. While that is all true, I am thinking there is a bunch of tech on the horizon beyond cars that will require increased energy storage, and the market might wake up to this fact sooner or later.

Personally, I am starting this theme with very small bets, will continue to dig deeper and watch the price action unfold. I will keep you updated.

Good Luck

—NS