We have highlighted the anomalous behavior of Lithos Group Ltd. (LITS:CBOE.CA; LITSF:OTCMKTS; FSE:YU8; WKN:A3ES4Q) stock on several occasions this year, with the stock continuing to drift lower and lower, yet all the while, its Accumulation line has continued to forge ahead, creating a positive divergence that promises a reversal into a major bull market.
A reversal in the stock was called early in July but to no avail — it just continued to fall, but the rate of decline has slowed markedly, as we can see on its latest 6-month chart below, so that downside momentum (MACD) has been dropping out with the preponderance of upside volume — especially in recent weeks with more aggressive buying evident — driving the Accumulation line relentlessly higher.
The technical situation can thus be compared to someone pushing a large beach ball completely underwater, and we know how that ends — with the ball suddenly breaking free and bursting to the surface.
It is thus interesting to see the positive news released by the company yesterday. This news was that Lithos announced positive results from AcQUA™ technology lithium brine tests with SQM on Salar de Atacama Brines.
This news is a really big deal because it means that the technology that the company has been developing to make possible the efficient production of lithium without the need for traditional evaporation ponds actually works and can be implemented. Here are some of the most important paragraphs from the news release. . .
Key achievements:
- Exceptional purity: The AcQua technology has achieved interesting rejection rates of magnesium, boric acid (HBO3), calcium (CaCl), and sulphates (SO4), requirements that are essential for producing high-purity lithium, crucial for battery manufacturing.
- Innovative technology: Unlike traditional methods, AcQua uses a patent-pending, hybrid electropressure membrane process that increases lithium concentration without the use of fresh water and harmful chemicals, marking a significant step forward in sustainable mining technologies.
- Environmental benefits: By eliminating the need for evaporation ponds, the AcQua technology substantially reduces the footprint of lithium mining. This aligns with global environmental standards and supports the industry's shift toward sustainable practices.
After this release, Scott Taylor told Streetwise Reports, "We [Lithos] have three tier-one lithium producers that we have delivered successful processing fluid processing tests. Each of the three customers, including SQM, has requested commercial proposals for paid field work, which are all currently under consideration. We are working to sign and announce the final terms of these purchase orders in the next few weeks."
The names of two of these companies are not currently public. The first one is SQM, which the company announced positive test results on the company's brines in the above press release.
According to Stockwatch, SQM and Albemarle have similar market caps of >US$10 billion It is one of the largest lithium stocks, per an article on USA Today. Others include Albemarle Corp. (ALB:NYSE), Rio Tinto Plc (RIO:NYSE; RIO:ASX; RIO:LSE; RTPPF:OTCPK), and Arcadium Lithium Plc. (ALTM:NYSE; LTM:ASX).
Holders of Lithos Group should, therefore, stay long and may want to add to holdings, and the stock is rated an Immediate Strong Buy here. It is available to U.S. investors on the OTC market where it trades in healthy volumes.
Lithos Group's website.
Lithos Group Ltd. (LITS:CBOE.CA; LITSF:OTCMKTS; FSE:YU8; WKN:A3ES4Q) closed at CA$0.20, US$0145 on August 20, 2024.
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Important Disclosures:
- Lithos Group Ltd. has a consulting relationship with Street Smart an affiliate of Streetwise Reports. Street Smart Clients pay a monthly consulting fee between US$8,000 and US$20,000.
- As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Lithos Group Ltd.
- Author Certification and Compensation: [Clive Maund of clivemaund.com] is a technical analyst who analyzes historical trading data and he received his UK Technical Analysts’ Diploma in 1989. The recommendations and opinions expressed in this content reflect the personal, independent, and objective views of the author regarding any and all of the companies discussed.
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Clivemaund.com Disclosures
The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks cannot be construed as a recommendation or solicitation to buy and sell securities.
