Why has the Core Lithium share price gained 13% in the past week?

The Core Lithium Ltd (ASX: CXO) share price has been in fine form in the past week.

At the time of writing, shares in the lithium producer are up 4.43% to $1.593.

This means since last Thursday, the share is up 13.75%.

In contrast, the S&P/ASX 200 Materials (ASX: XMJ) index is roaring 2.35% today, but down 5.33% in a week.

Let’s take a look at what driving the company’s shares forward while the broader index remains sluggish.

What’s happened to the Core Lithium share price?

After rocketing to a near all-time high of $1.665 on 16 August, the Core Lithium share price took a breather.

The share slumped almost 25% in the two weeks after as investors booked a tidy profit.

Notably, the relative strength index (RSI) climbed to 79 on 15 August – just before the share was heavily sold off.

However, this didn’t stop Core Lithium shares from quickly rebounding as sentiment picked up across the market.

Earlier this week, ABC News reported that electric vehicle (EV) sales recorded their highest levels ever.

This bodes well for the company as it’s targeting its first production of spodumene concentrate by the end of 2022.

With EVs becoming more mainstream in the Australian market, Core Lithium is well placed to respond to demand.

Recently, the company announced it significantly increased the Mineral Resource Estimate and Ore Reserves Estimate for the Finniss Lithium Project.

Core Lithium wholly owns the Finniss Lithium Project, located just south of Darwin Port in the Northern Territory.

The Core Lithium share price has rocketed to more than 350% over the past year, and is up almost 170% year to date.

Based on today’s price, Core Lithium commands a market capitalisation of roughly $2.64 billion.

The post Why has the Core Lithium share price gained 13% in the past week? appeared first on The Motley Fool Australia.

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More reading

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• Why are ASX lithium stocks having such a stellar run today?
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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