”Lithium South Development Corp gapped higher on big volume yesterday from a very low level and this morning the reason for this move has become evident with the the news of a 175% increase in their lithium resource. So it is thought likely that a big move is just starting and it is rated an immediate speculative buy as soon after the open as possible. A positive is that it appears to have been basing in recent weeks following a sizeable decline from its April highs. We will look at its chart later on the site. It trades in healthy volumes on the US OTC market.
Lithium South Development Corp., LIS.V, C$0.45, $0.335.”
As we can see on its 5-month chart it gapped higher again at the opening this morning, hardly surprising considering the news, and it is continuing to forge ahead. Since this chart was prepared, which wasn’t long ago, it has broken clear above the resistance, so our decision to go for it as soon as possible after the open has been vindicated and having broken above the resistance it looks like it is headed much higher.
The long-term 10-year chart gives us perspective on the history of the stock. As we can see the company has been around for a quite a long time but apart from a brief massive ramp higher in 2017, it hasn’t done all that much. However, that, may soon be changing given the just announced big increase in the company’s main resource and lithium being in huge and possibly expanding demand into the foreseeable future. The rather high number of shares in issue at 163 million is largely due to the company having existed for a long time and is factored into the stock price and so shouldn’t significantly impede improvement in the stock price.
We therefore remain long any stock bought early today, and it remains a buy even after today’s move, although ideally it would be best to buy or add to positions on dips, if any.
Lithium South Development Corp website
Lithium South Development Corp., LIS.V, LISMF on OTC, trading at C$0.53, $0.386 at 12.12 pm EDT on 12th September 23.
Posted at 12.35 pm EDT on 12th September 23.