Gold has cooled after market turmoil allowed it to interrupt US$2,000 per ounce not once last week, but twice. Though the steel neared that stage this week, it was slightly below US$1,970 on the time of this writing on Friday (March 31).
Previous to final week, gold had solely handed US$2,000 a few instances up to now — first in July 2020 amid international COVID-19 pressures, and subsequent in February 2022 on the again of Russia’s invasion of Ukraine.
Now market watchers understandably wish to know what’s subsequent for the yellow steel, and I requested David Morgan of the Morgan Report to share his ideas. He stated if gold is ready to hit a brand new excessive it might take off working.
“When you get to the brand new excessive, we’ll name it US$2,060, then the algorithms kick in,” he stated. “The algorithms know the momentum play is everytime you make a brand new excessive there isn’t any upward resistance. So even slightly bit of shopping for will drive it larger. And whenever you get one other new excessive, then everybody says, ‘Oh, gold’s on a run. How far will it go?’ And there isn’t any promoting — I am exaggerating barely, however there’s not that a lot promoting. And so then slightly bit extra shopping for or a number of shopping for will take it even larger.”
Lithium M&A in focus as Liontown shuts down Albemarle
Gold M&A has acquired a number of consideration these days, however this week introduced a serious transfer in lithium. Liontown Sources (ASX:LTR,OTC Pink:LINRF) stated on Monday (March 27) that it has rejected an indicative proposal from Albemarle (NYSE:ALB).
In keeping with Liontown, main producer Albemarle needed to amass all the firm’s shares at a value of AU$2.50 every. Liontown believes this quantity is a considerable undervaluation, though it does are available in above Albemarle’s earlier two affords of AU$2.35 per share on March 3 of this 12 months and AU$2.20 per share on October 20 of final 12 months.
Explaining its stance, Liontown calls Albemarle’s strategy “opportunistic” given the current softness in firms uncovered to the lithium sector. The corporate additionally highlights ongoing exercise at its flagship Kathleen Valley challenge in Western Australia, saying that the asset is being de-risked as mining operations begin up and development continues on schedule.
“In coming to its choice, the Liontown Board famous the opportunistic timing of Albemarle’s Indicative Proposal, coinciding with current softness in firms uncovered to the lithium sector and the pre-production standing of the Kathleen Valley Undertaking” — Liontown Sources
Albemarle’s bid quantities to US$3.7 billion, and the truth that Liontown shot it down has sparked commentary on precisely how a lot giant producers could need to pay in the event that they wish to add superior properties to their portfolios — Kathleen Valley is ready to ship its first output in mid-2024. We’ll be watching intently to see how the story develops, so keep tuned for extra updates.
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Securities Disclosure: I, Charlotte McLeod, maintain no direct funding curiosity in any firm talked about on this article.
Editorial Disclosure: The Investing Information Community doesn’t assure the accuracy or thoroughness of the knowledge reported within the interviews it conducts. The opinions expressed in these interviews don’t replicate the opinions of the Investing Information Community and don’t represent funding recommendation. All readers are inspired to carry out their very own due diligence.
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