As it happens, the setup looks better than good – it looks excellent. For looking at the latest 3-month chart, which shows recent action in detail, we see that the volume pattern is exceptionally bullish with persistent heavy volume driving the early December rally, following a “head fake” false breakdown from the Triangle that we correctly identified at the time, with a dramatic contraction in volume as the price has reacted back to quite strong support above the now rising 50-day moving average with the Accumulation line remaining elevated. All of which suggests that this reaction back is a bull Flag / Pennant that will be followed by another upleg that could be steep.
Lithium South is known to be in possession of very valuable lithium assets and it is suspected that the heavy buying early in December was either the work of predators building a position ahead of a possible takeover or speculators calculating that a buyout is in the offing at some point, or a combination of the two.
Lithium South is therefore rated a strong speculative buy at this juncture. While there are no guarantees that there will be another upleg – there are no guarantees of anything in this business - it does nonetheless look highly probable that we will see another upleg develop shortly, an upleg that could be BIG.
Lithium South Development Corp website
Lithium South Development Corp., LIS.V, LISMF on OTC, trading at C$0.36, $0.273 at 2.20 pm EST on 26th January 24.
Posted at 2.25 pm EST on 26th January 24.