ABAT poised for massive breakout
Updated
American Battery Technology Company is primarily a Li-ion battery recycling company with goals to be a major U.S. provider of battery black mass and battery metals and compounds. They have been awarded many millions in federal funds and are growing rapidly. The company announced in September to increase available shares from ~80M to 250M, however no immediate share sales are anticipated. This stock rose to great heights amid the COVID stock market mania, and has since fallen quite far, particularly after September of 2023, when the stock had a 1/15 reverse split to meet requirements for listing on the NASDAQ.
The stock has been trading at ~$1 (the minimum requirement for NASDAQ listing) for approximately 3 months. This has built an exceptional level of resistance, above the pre-COVID mania stock price.
Shown here in the upper chart in red, white, and green lines are various moving averages on the 3-day chart. Lines will change colors from red to white, white to green, and vice versa, as the moving average increases or decreases and flips a neighboring moving average line. As you can see, following prolonged expansion of the total moving averages, large reversals tend to occur (effectively a reversion to the mean). The RSI chart shows a bottoming out and slight reversal, flashing bullish strength.
The bottom chart shows the same moving averages on the 1-day chart. You can see how the moving averages are converging (contracting), and this often signals a coming move. Following a Sept. 20 announcement of new federal grants, a blowoff stock sale occurred which was quickly absorbed by buyers. The volume of that event over 3 days was >100% greater than any other 3-day period in the stock history.
I believe ABAT is poised for a massive breakout and, at minimum, a 100-200% run in the very near future. Evidence:
I don't know what will be the catalyst. The company, for all its strengths, is a bit quiet.
The stock has been trading at ~$1 (the minimum requirement for NASDAQ listing) for approximately 3 months. This has built an exceptional level of resistance, above the pre-COVID mania stock price.
Shown here in the upper chart in red, white, and green lines are various moving averages on the 3-day chart. Lines will change colors from red to white, white to green, and vice versa, as the moving average increases or decreases and flips a neighboring moving average line. As you can see, following prolonged expansion of the total moving averages, large reversals tend to occur (effectively a reversion to the mean). The RSI chart shows a bottoming out and slight reversal, flashing bullish strength.
The bottom chart shows the same moving averages on the 1-day chart. You can see how the moving averages are converging (contracting), and this often signals a coming move. Following a Sept. 20 announcement of new federal grants, a blowoff stock sale occurred which was quickly absorbed by buyers. The volume of that event over 3 days was >100% greater than any other 3-day period in the stock history.
I believe ABAT is poised for a massive breakout and, at minimum, a 100-200% run in the very near future. Evidence:
- Moving averages on high time frames have show over-expansion for a prolong period of time
- Moving averages on low time frames show local contraction over recent weeks, a sign of a breakout move
- Both RSI and CDV are bottoming out and flashing reversals on high time frames
- The unprecedented selloff and failure to break below the ~$1 buy wall from Sept 20-25 indicates to me that a positive price reversal is the most favorable move
I don't know what will be the catalyst. The company, for all its strengths, is a bit quiet.
Trade active
Additional information:
As of Oct 15, ABAT is sitting near record high short interest at 9.1% or 6,340,000 shares. Since July 31, short days to cover have sat at around 11, dipping to 8.5 in September, with 11.8 days to cover as of Oct 15.
With regard to days to cover, 2-5 days is considered normal, 5-10 days is considered elevated, 10+ days is considered dangerous and at high risk of a squeeze. This higher this number goes without the price breaking below ~$1, the stronger the move upward.
Note
ABAT held a shareholder meeting today. Nothing too exciting, but it is clear they are currently in offtake agreement negotiations and in discussion with partners to build a second recycling facility, perhaps in the Southeastern US (Yee yee)Trade closed: target reached
This will need to show some spunk and make a clear move back above $1, else this drops to <$0.70, maybe low of $0.6
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