Story Highlights
Tesla could announce plans for two more Gigafactories, and it wouldn’t matter.
The lithium industry, which is integral for electric vehicle (EV) batteries, is hoping for a revival.
After a two-year bear market slide, lithium stocks started to recover four months ago.
But Tesla can’t do anything today to change the fate of lithium stocks in the next three months.
These stocks are set to fall as much as 13%.
Fortunately, there’s a simple way to turn that decline into a gain 10 times larger.
Coming up, I’ll explain how I help readers ramp up their trading gains when stocks are rising or falling.
First, though, I want to show you this chart that tells me lithium stocks are ready to drop.
That’s the Global X Lithium & Battery Tech ETF (NYSE: LIT). This exchange-traded fund (ETF) tracks an index of lithium stocks.
It includes leading lithium producers such as Albemarle Corp. (NYSE: ALB) and Sociedad Quimica y Minera de Chile (NYSE: SQM), as well as some lesser-known companies.
The bull market in 2016 and 2017 drove the price of LIT up by 133%. The bear market erased 75% of that trend.
Then LIT bounced 27% from September 2019 to January 2020 — the blue a-b-c pattern on the chart.
That’s an example of an Apex Movement Pattern (AMP), a framework our system uses to reveal and predict trader behavior.
Our AMPs tell us the direction will change again for LIT.
Here’s what’s going on…
My colleague Matt Badiali helped his readers avoid lithium’s bear market.
He saw the writing on the wall.
EV hype caused the lithium price to surge. Producers ramped up production to capitalize on high prices.
But they outran demand … by a lot.
Excess supply caused the bear market.
Matt and I exchanged emails on Monday about this, and he said:
EV market investors expected the change to happen immediately … and invested as if it were going to happen immediately. But they were years behind with the rollout of the main EVs. So, expectations were super high for something that moves slowly.
The bearish reality for lithium explains why lithium stocks were left for dead.
Investors put the cart ahead of the horse three years ago.
And they’re doing it again today.
But you can make money on lithium stocks now by doing what we do.
Expert: “Tech Giants Are Racing to Acquire ‘Fluorescent Sand’” [sponsor]
Google, Microsoft, Facebook, Verizon and Amazon are investing hundreds of millions — even billions — of dollars to hoard this new miracle material one expert calls “fluorescent sand.” But no matter who wins this race, you could make a fortune in the weeks and months ahead … Details here.