So I just met (online not IRL) someone whilst playing chess who's username is WallStBets and we had a chat about trades and his pick was the supposed inflation hedge Lithium and recommended SQM.
I looked them up and they are apparently the world’s biggest lithium producer.
So looking on 2M chart SQM appears to have had an enormous blow off top relative to the trend. It has popped up way above the upper bollinger band and printed a huge star candle showing selling pressure coming in.
RSI overbought and will probably at least get back to the bottom quadrant before any more action.
So it looks like a major top.
Interestingly with SPX overlaid the last time SQM pumped like this was during the 2008 crash and I dont know why that is but it looks like a cheeky little multiplier for those in the know.
Anyhow - who knows maybe it is the inflation hedge and will carry on up as it did before but with GOLD SILVER PLATINUM NICKEL COPPER all looking very bearish currently, its not a market I want to be in, at least not right now.
After a significant top like this it should at least get back to log 0.382 which is $53 even if the trend continues.
But if we look at the previous time this happened in 2008 it then suffered a 100% retracement - complete collapse. I'm not saying it will but if it happened again it would crash to $16.
Not advice.
... Can see you are following Wal1stbets . Hope you like the chart and we are now chess friends 😄. Feel free to come say hi.
I looked them up and they are apparently the world’s biggest lithium producer.
So looking on 2M chart SQM appears to have had an enormous blow off top relative to the trend. It has popped up way above the upper bollinger band and printed a huge star candle showing selling pressure coming in.
RSI overbought and will probably at least get back to the bottom quadrant before any more action.
So it looks like a major top.
Interestingly with SPX overlaid the last time SQM pumped like this was during the 2008 crash and I dont know why that is but it looks like a cheeky little multiplier for those in the know.
Anyhow - who knows maybe it is the inflation hedge and will carry on up as it did before but with GOLD SILVER PLATINUM NICKEL COPPER all looking very bearish currently, its not a market I want to be in, at least not right now.
After a significant top like this it should at least get back to log 0.382 which is $53 even if the trend continues.
But if we look at the previous time this happened in 2008 it then suffered a 100% retracement - complete collapse. I'm not saying it will but if it happened again it would crash to $16.
Not advice.
... Can see you are following Wal1stbets . Hope you like the chart and we are now chess friends 😄. Feel free to come say hi.
Note
Just in case my new chess friend does see this I dont want to wriggle him out of his trade only for it to bounce,SQM does appear to be in a corrective descending channel which can lead to a bounce. RSI looks like it may drop a bit lower so it may not bounce yet but taking a guess at the low it may bounce to $90 to $100 area perhaps as indexes also bounce.
Note
The fib trendline wasn't properly attached to the low but anyhow it did what I suggested. Perhaps further sideways movement or perhaps not but either way its heading down.I'm actually going to keep an eye on this one.
Note
I've had a look again and it is a major top i think so to consider it for a buy it would need to get back to at least the 0.618 $33 but i would perhaps not touch it until 0.786 $24.Alarm set for $33 - i'll wake up then. It will probably take a while 😸.
Your FA guru can't read a chart💭
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Your FA guru can't read a chart💭
I run a technical group with lots of content every day + regular videos, 1:1, chatroom 🚀.
Better than all the rest? My record speaks for itself 💡.
Telegram Group: $50 per month✨.
Contact: t.me/dRends35
I run a technical group with lots of content every day + regular videos, 1:1, chatroom 🚀.
Better than all the rest? My record speaks for itself 💡.
Telegram Group: $50 per month✨.
Contact: t.me/dRends35
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.