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Source: Tom Armistead of The Energy Report (8/22/13)

http://www.theenergyreport.com/pub/na/two-ways-to-capitalize-on-accelerating-lithium-demand-luisa-moreno

The sleekest, most efficient electronic product is nothing without the battery that powers it. Enter lithium, the raw material battery manufacturers depend on. With electric/hybrid vehicle use on the rise and demand for consumer electronics steadily climbing, lithium producers with quality product should have no shortage of potential buyers. In this interview with The Energy Report, Luisa Moreno, mining and metals analyst with Euro Pacific Canada, names her top lithium picks with both the goods and the customers.

The Energy Report: Luisa, tell me: What is exciting about lithium?

Luisa Moreno: Lithium has many unique and important characteristics. It is the least dense solid element and the lightest metal. It forms alloys with some of the highest strength-to-weight ratios. Lithium has the highest specific heat of any solid element, and is used in heat-transfer applications. It has neurological effects in humans, and so is used in pharmaceutical applications, such as mood stabilizers. Lithium chloride and bromide are two of the most hygroscopic, or water-absorbing, known materials and are used in air conditioning, industrial drying systems and dehumidifiers.

In the recent years, lithium has gained increasing attention as it has become an essential component in ultralight electronic devices. It is also increasingly the preferred medium for electric vehicle batteries, and that makes lithium important for the development of a greener, cleaner world.

TER: What are the principal industrial applications of lithium?

LM: The major application traditionally has been in the glass and ceramics industry and is used in the manufacturing of grease lubricants. Lately, we have seen an increased demand for lithium in the battery sector. Batteries, glass and ceramics combined account for more than 55% of the world demand. Lubricants and metallurgical applications are also important and account for about 20% of world demand.

TER: Which applications are growing the fastest?

LM: Battery applications are growing significantly faster. We expect to see that sector increasing about 12.6% per year going forward to 2020. The others will continue growing, but more on pace with the global GDP, closer to 3%.

TER: Does lithium have any competitors in these applications among commodities?

LM: There are substitutes for lithium in most of its applications, but it seems that lithium has been consistently the preferred element material because it likely offers the best performance/cost ratio compared to other materials.

TER: How fast has demand for lithium grown in the last decade?

LM: It has grown 7–8% per year. That has been driven significantly by demand in the battery sector, which is related to the adoption of electric vehicles and smart devices like iPhones, iPads and lighter laptop computers.

TER: What companies in lithium are your favorites, and why?

LM: We’ve been following the progress of Nemaska Lithium Inc. (NMX:TSX.V; NMKEF:OTCQX). We like how the Whabouchi project has progressed. The Whabouchi deposit grades are among the highest in the world. While most lithium junior companies are targeting the lithium carbonate market, Nemaska is focusing on lithium hydroxide, which is a higher value product. It can be sold at a price of more than $8,000 per tonne ($8K/tonne) compared to $6K/tonne for carbonate, depending on grade. And lithium hydroxide is an increasingly interesting lithium compound for batteries because it also offers better performance.

Nemaska has also managed to secure strategic partnerships. One of them is with Sichuan Tianqi Lithium Industries Inc., a subsidiary of Chengdu Tianqi Industry Group Co. In addition, Nemaska has a secure partnership with Phostech Lithium (a subsidiary of Clariant Canada Inc. a member of Clariant AG Group [SWL:CLN]), and is fairly close to production now. It wants to develop a modular plant to start producing lithium hydroxide.

So, to sum it up, we like its high-quality deposit, its unique business plan, its new process targeting a not-so-competitive part of the market and the partnerships that it has been able to secure. We have a Speculative Buy recommendation for the stock and a $0.57 target price.

TER: Nemaska has a 100% offtake with Phostech scheduled for 2014. Will the modular construction enable Nemaska to complete a 500 tonnes-per-annum (500 tpa) plant by then?

LM: Yes, contingent on its ability to finance that first plant. Its target is even higher—20,000 tonnes—so that will be the first modular plant of many other ones to follow. The idea is for Nemaska to work together with Phostech Lithium to tailor the lithium hydroxide product to the specifications of Phostech Lithium and other potential customers.

TER: Nemaska Lithium Inc.’s share price dropped very quickly starting in March 2013. What happened then to cause it to drop?

LM: I’m not completely sure why the stock had such a hit. The market for resources has been very volatile and weak. The company has been trying to raise funds for the first plant and, given the markets, the fundraising period was extended. It is possible the market was nervous about that and there was some pressure on the stock as a result.

TER: Is the Cree Nation committed to Nemaska Lithium Inc.’s business plan to exploit the resources up there?

LM: It seems to me that they are committed to the development of the project. I visited the Nemaska Lithium site, and when we were there we had the privilege to meet the chief of the Cree Nation and some of the other members of the community. They own 2.6% interest in Nemaska Lithium. They showed a lot of interest in the mine’s development and believe it could bolster economic development for the region.

TER: Are there any other companies that interest you?

LM: Yes, we launched coverage of Canada Lithium Corp. (CLQ:TSX; CLQMF:OTCQX). We have a Speculative Buy recommendation and $0.90/share target for the company. We like that name, first of all because it’s one of the most advanced, if not the most advanced lithium project right now. The company has completed most of the construction and is starting to produce on a continuous basis. The target production for this year is roughly 3,000 tonnes. It expects to reach its 20,000-tpa target by next year.

Canada Lithium has secured offtake agreements with two different parties. The company has a business plan to diversify its suite of products. The main product is lithium carbonate but it plans to also produce lithium hydroxide and sodium sulfate products. It got a $6.5-million ($6.5M) grant from Sustainable Development Technology Canada (SDTC) to develop a lithium metal plant, so that’s another project under development. The company is really one of the frontrunners. It’s very well positioned, has offtake agreements and a strong management and technical team.

TER: Canada Lithium Corp.’s mine and plant are only in the startup phase, but you expressed confidence that it will be able to produce other lithium products by 2015 and build a sodium sulfate plant. That’s a pretty full plate. What’s the basis for your confidence?

LM: The company is very much interested in developing these other businesses. We did not include these other products in our model and they’re not part of the target price, either. From my perspective, this is potential blue sky for the company. As I said, the company has a grant of up to $6.5M to develop the plant for the metal, so it already has that funded for development of a pilot plant. And it has done extensive work for the production of lithium hydroxide. It worked with SGS Minerals Services, and concluded it would be economic to develop a facility for lithium hydroxide.

TER: What is the term for Canada Lithium Corp.’s offtake contracts?

LM: The contract with Tewoo Group is a five-year agreement to sell a minimum of 12,000 tonnes of battery-grade lithium carbonate, which accounts for 60% of Canada Lithium’s production target of 20,000 tonnes of lithium carbonate. The agreement has a provision that allows the offtake to increase to 14,000 tonnes, which would account for about 72% of the total target for production. The other contract with Marubeni Corp. (MARUY:OTC; TYO:JP-8002) is a three-year distribution agreement. It will start at a minimum of 2,000 tonnes of lithium carbonate this year, and that could potentially increase to about 5,000 tonnes going forward. These are very nice agreements considering Canada Lithium is not at full production yet.

Canada Lithium was likely able to secure a good share of the supply market as it is planning to sell a carbonate product with higher purity and higher value than products sold from existing South American brine producers. South American “commercial” grade lithium carbonate sold for about $4K/tonne in 2012, and Canada lithium expects to sell its lithium carbonate product for $6K/tonne, 50% higher. North American high-purity lithium producers, including Nemaska, benefit from relatively lower energy and reagent costs.

TER: Do you have any other lithium companies under coverage?

LM: We have featured a number of other names that we are watching very closely. We like Orocobre Ltd.’s (ORL:TSX; ORE:ASX) Salar de Olaroz project in Argentina. According to recent announcements, the company is now lining the evaporation ponds and will start the evaporation process very soon. That process usually takes 18–24 months, so we expect the company to start producing some brine concentrate probably by 2015 or 2016. We also appreciate that the company has a partnership with Toyota Tsusho Corp. (JP-8015:TYO) and seems to be well funded.

Back into the hard rock space, we like the names that have the potential for byproducts. We are watching two companies very closely. One is Critical Elements Corp. (CRE:TSX.V), which has a project in Quebec as well. The company has potential to produce a tantalum byproduct out of its spodumene deposit.

Houston Lake Mining Inc. (HLM:TSX.V) is a smaller but very interesting company in the early stage of development. It has shown very high grades from drill results, with byproducts as well of tantalum, and potentially cesium and rubidium.

We have featured a number of companies at different stages of development and with different types of lithium deposits, including those with lithium clay deposits and jadarite-rich deposits with lithium and boron mineralization. We expect some of these companies to become part of a diversified lithium supply market.

TER: I appreciate your time, Luisa. It’s a very interesting field.

LM: Absolutely.

Luisa Moreno is a mining and metals analyst with Euro Pacific Canada. She covers industry metals with a major focus on electric and energy metal companies. She has been a guest speaker on television and at international conferences. Luisa has published reports on rare earths and other critical metals and has been quoted in newspapers and industry blogs. She holds bachelor’s and master’s degrees in physics engineering from Nova University of Lisbon and a PhD in materials and mechanics from Imperial College London.

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DISCLOSURE:

1) Tom Armistead conducted this interview for The Energy Report and provides services to The Energy Report as an independent contractor. He or his family owns shares of the following companies mentioned in this interview: None.

2) The following companies mentioned in the interview are sponsors of Streetwise Reports: None. Streetwise Reports does not accept stock in exchange for its services or as sponsorship payment.

3) Luisa Moreno: I own or my family owns shares of the following companies mentioned in this interview: None. I personally am or my family is paid by the following companies mentioned in this interview: None. My company has a financial relationship with the following companies mentioned in this interview: None. I was not paid by Streetwise Reports for participating in this interview. Comments and opinions expressed are my own comments and opinions. I had the opportunity to review the interview for accuracy as of the date of the interview and am responsible for the content of the interview.

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Article by Investazor.com

This scalping system uses two types of Bollinger Bands and an Exponential Moving Average. It can be used on any currency pair and the time frame could be set from 1 minute to 15 minutes, but it seems to be working best on the 5 minutes chart.

Bollinger Bands is a technical indicator discovered by John Bollinger., its default settings are a moving average of 20 periods and a standard deviation of 2. This system uses one Bollinger Bands with a moving average of 21 and a standard deviation of 2 and one Bollinger Bands with the same moving average but with a standard deviation of 3.

The idea of the system is to look for the moments when the price touches the upper or the lower layer between the standard deviation of 2 and standard deviation of 3. Using 200 EMA will help the trader follow the important trend. If the price it is above the EMA the trader will look only for long entries. If the price is under the EMA then the trader will look for short positions.

The signal would be a candle which touches (or better closes) inside the layer between the two deviations and the confirmation would be a candle of the opposite color signaling the reversal.

If the conditions are fulfilled a trade should be opened on the opening of the third candle. The Stop Loss should be set under/above the previous two candles, on the low/high (depending if the price is under or above the 200 EMA). The first target can be set at the 21 moving average of the Bollinger Bands and the second target could be set on the upper/lower line of the Bollinger Bands with a standard deviation of 2. Look over the example bellow for better understanding. The same system can be applied also if the price is under the 200 EMA.

Previous << Simple Forex Scalping Strategy For EURUSD and GBPUSD <<

The post Advanced Forex Scalping Bollinger Strategy appeared first on investazor.com.

Article by Investazor.com

Today, the Eurozone’s PMI indices were released. PMI means Purchasing Managers’ Index and is the best communicator of the economic climate for the concerned area. Even if it represents a survey of managers working in the manufacturing industry, it tends to represent the whole economy. Why? Because the manufacturing industry is an important segment of any economy which is able to indicate in advance if the economy is going in a good direction or it tends to slow. When calculating this index, five sub-indexes are considered: new orders, inventory levels, production, supplier deliveries and the employment environment. To simplify the understanding of this indicator, you just have to take as a mark the 50.0 level. Above it indicates that the industry is expanding and below it indicates a contraction of the industry.

Back to the news today, the Eurozone reflects a real improvement, reporting levels of the PMI indices that were last met in the middle of 2011. Even if French was the only one who missed the expectations (49.7), indicating a slight contraction, Germany, the European engine, beat expectations (52), as well as the index reflecting the manufacturing industry for the whole Eurozone (51.3).

The world’s economy seems to recover, slowly, as positive signals from the U.S., Europe and China are becomes increasingly evident. On the other hand, should be considered the fact that this recovery is due to be accomplished in the long term and meanwhile important obstacles may occur. Recent data improved the outlook for the biggest economies but put some pressure on the emerging markets as investors are shifting towards the largest economies.

The post The Eurozone PMIs Are Indicating A Recovery appeared first on investazor.com.

EURUSD found some support an hour back or so, after disappointing US Unemployment claims. So I decided to check the intra-day structure on USD Index to see where the buck is positioned and headed next. Well, on the line chart I can see some very clear impulse to the upside, but its presented on a line chart. Its a clear five wave move with a textbook example of an extended wave three. If you are still learning Elliott Wave, then I suggest you to save and print this chart.
Current structure suggests that low is in place, because five-wave move is important evidence for a direction of a current trend. If that’s the case then we know that any pull-back to the downside should be only corrective retracement before USD breaks even higher.

USD Index 30min- Elliott Wave Analysis

Impulse extension-Elliott Wave Pattern
Most impulses contain what Elliott called an extension. An extension is an elongated impulse with exaggerated subdivisions. The vast majority of impulses contain an extension in one and only one of their three actionary subwaves.

The fact that extension typically occurs in only one actionary subwave provides a useful guide to the expected lengths of upcoming waves. For instance, if the first and third waves are about equal length, the fifth wave will likely be a protracted surge. Conversely, if wave three extends, like on our USD Index chart and on basic chart below, then the fifth should be simply constructed and resemble wave one. In the market, the most commonly extended wave is wave three.

Basic chart of extended third wave

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By www.CentralBankNews.info Here’s today’s Central Bank News’ link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don’t miss any important news.

London Gold Market Report
from Adrian Ash
BullionVault
Thurs, 22 August 08:45 EST

The PRICE of gold recovered overnight losses after the release of US Federal Reserve meeting notes in London trade Thursday morning, rising back to $1375 as major stock markets also rose with commodities.

 The Dollar continued to strengthen, helping the gold price rally faster for non-US investors.

 Reversing an earlier 1.5% drop, the gold price in Euros regained last Friday’s finish above €1030 per ounce – the highest weekly close in ten.

 Silver prices also rose back to last week’s finish above $23.25.

 “[The Fed] minutes were generally consistent with our view,” says Goldman Sachs economist Jan Hatzius, “that tapering of asset purchases is likely to occur at the September meeting,”

 But “The Fed has not settled on a September taper,” says the Financial Times. Instead, the July 31st minutes show it is now “flirting with recalibrating its forward guidance to mitigate tapering fears.”

 In the bullion market, “It was correct that the [gold price] came off,” says broker Marex Spectron, also commenting on the Fed minutes, “eventually making a low of almost $1355 before being rescued by a stronger than expected Chinese PMI number.”

 New data Thursday showed the manufacturing sector in China – the world’s #2 gold consumer market – expanding for the first time since April.

 “Gold is likely to stay choppy in the near term on thin liquidity,” says a precious metals note from bullion market maker HSBC.

 “While the metal remains above $1348,” says fellow bullion dealer Scotia Mocatta, “we believe there is a high probability of gold making a move to $1416.”

 On the supply-side Thursday, shares in South Africa’s second largest producer, Gold Fields, dropped almost 10% after it posted a loss for the April to June quarter.

 Confirming the $300m purchase of Australian properties from world #1 Barrick, CEO Nick Holland also offered today to waive his 2013 bonus “in recognition of concerns” over how 9% of Gold Fields’ giant South Deep mine was given to black investors three years ago to meet the national government’s Black Economic Empowerment (BEE) targets.

 Holland’s bonus in 2012 was worth some $840,000.

 The National Union of Mineworkers, which represents nearly two-thirds of South Africa’s 140,000 gold miners, is currently demanding a basic wage of $800 per month – a rise of 60% from current levels according to Reuters.

 Yesterday the NUM quit talks with management and said it will ballot members about joining tens of thousands of construction and auto workers already striking over pay claims.

 “In other words,” says a note from Germany’s Commerzbank, “the fifth-largest gold producing country is soon likely to see supply outages.”

 “The [South African] gold industry is frankly in crisis at the moment,” says Holland.

 With global prices falling by a quarter in 2013, some 60% of the country’s gold output– down by more than one half from leading the world a decade ago – was operating at a loss last month according to Business Day.

 “When you talk about costs there are two elements,” says diversified mining giant BHP Billiton’s CFO Graham Kerr, speaking to Reuters.

 “One is how you tighten your belt and make the easy changes. The second is productivity – getting more out of your existing people, your equipment and your infrastructure.”

 BHP this week announced a $2.2 billion cut to operating expenses for the year, helping offset an $8.9bn drop in operating profits due to lower base metal and other mineral prices.

 In contrast to Western gold mining firms, who have been told by shareholders “we’d rather you not do M&A transactions” according to world #1 Barrick, Chinese mergers and acquisitions in gold have risen to new records this year, says Bloomberg.

 “Price declines are good for key Chinese producers to buy overseas assets,” the newswire quotes China #4 Zhaojin Mining’s head of overseas resources development Chen He.

 Back in the bullion market meantime, “Gold appears to be more stable these days,” says a note from Swiss refining and finance group MKS, “with a reversal in ETF outflows and still strong physical demand by China, India and Turkey.”

 Bullion holdings needed to back the world’s largest gold ETF – the SPDR Gold Trust – slipped 0.6% tonnes on Wednesday, edging back towards 54-month lows at 913 tonnes.

 “We expect ETF selling to pick up again,” said commodities analysts at Societe Generale in a report last week, “with the expectation of Fed tapering, rising real [interest] rates, and a stronger Dollar.”

Adrian Ash

BullionVault

Gold price chart, no delay | Buy gold online

Adrian Ash is head of research at BullionVault, the secure, low-cost gold and silver market for private investors online, where you can buy gold and silver in Zurich or Singapore for just 0.5% commission.

(c) BullionVault 2013

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

USDCHF hit a new low in this week, but now again reversing from it which could be start of some larger and important turning point. Notice that we are tracking a corrective decline from 0.9750 which is actually part of a much bigger contra-trend move on a daily chart where we are tracking triangle within larger uptrend. As such, we are ready on a bullish move on USDCHF, but would have to see further strength from here and through the upper falling channel line, as well as 0.9394 level to make sure that lows are in. The reading on the RSI is also interesting, where prices reversed from its own trend-line and suggests higher reading as we move forward.
USDCHF 4h Chart- Elliott Wave Analysis

USDCHF Daily Chart- Elliott Wave Analysis

Written by www.ew-forecast.com | Try ew-forecast.com’s services free for 7 days

By HY Markets Forex Blog

The Eurozone currency was seen lower against the greenback on Thursday during Europe’s  morning trade , as the positive German manufacturing and services PMI data was released , which  surpassed analysts’ estimates in August.

The 17-nation currency cleared off some losses against the US dollar,  trading at a low 0.06% at $1.3346 against the greenback in response to the German flash manufacturing and services Purchasing Managers’ Index (PMI) which surpassed estimates. The euro was also seen 0.49% stronger then ¥131.10 against the Japanese Yen.

Germany’s Flash PMI Data

Germany’s flash manufacturing figure picked up to 52 in August, from previous record of 50.7 in the previous month and higher than the estimated 51.1 increase made by analysts, the preliminary data showed.

In the French manufacturing sector, business activities showed no changes during the month of August. The French manufacturing PMI remained unchanged at 49.7 in August. As for the services sector, the PMI declined to 47.7 in the month, from previous record of 48.6 in July, highest index reading since August 2012.

The Eurozone’s flash manufacturing PMI figure is expected to be released later today and it’s also expected to show an improvement. Analysts predict the figures to have increased to 50.7 for August, slightly up from previous month’s record of 50.3.

The Markit will release the flash PMI figure in the services industry for Eurozone, which is expected to show an increase from previous record of 409.8 to 50.2.

The Federal Open Market Committee’s (FOMC) minutes for July 30-31 meeting noted on how the policymakers were planning to begin to taper the $85 million monthly bond-purchasing program later this year as long as the economy recovers.

The Federal Reserve (Fed) has kept the interest rates close to zero; while the minutes noted that the primary target of 6.5% unemployment rate would indicate the economy has recovered.

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