danieldeubank
1 일 전
The MACD (Moving Average Convergence Divergence) is a popular technical analysis indicator used on stock charts to identify trends, momentum, and potential buy or sell signals. It’s a trend-following momentum indicator that shows the relationship between two exponential moving averages (EMAs) of a stock’s price. Here’s a breakdown of what it is and how it works:
Components of MACD
1. MACD Line: This is the core of the indicator, calculated by subtracting the 26-period EMA from the 12-period EMA.
* Formula: MACD Line = 12-period EMA - 26-period EMA
* The 12-period EMA tracks shorter-term price movements, while the 26-period EMA tracks longer-term trends. The difference reflects momentum.
2. Signal Line: A 9-period EMA of the MACD Line itself, plotted on top of it. It acts as a trigger for buy or sell signals.
* Formula: Signal Line = 9-period EMA of MACD Line
3. Histogram: The visual difference between the MACD Line and the Signal Line, shown as bars above or below a zero line.
* Formula: Histogram = MACD Line - Signal Line
* Positive bars (above zero) indicate the MACD Line is above the Signal Line (bullish momentum), while negative bars (below zero) show the opposite (bearish momentum).
How It Appears on a Stock Chart
* MACD is typically displayed below the main price chart as two lines (MACD Line and Signal Line) and a histogram.
* The zero line is a central reference point. When the MACD Line crosses above zero, it suggests bullish momentum; below zero, bearish momentum.
Interpreting MACD
1. Crossovers:
* Bullish Crossover: When the MACD Line crosses above the Signal Line, it’s a potential buy signal, indicating increasing upward momentum.
* Bearish Crossover: When the MACD Line crosses below the Signal Line, it’s a potential sell signal, showing weakening momentum.
2. Divergence:
* Bullish Divergence: If the stock price makes a lower low, but the MACD makes a higher low, it suggests weakening downward momentum and a possible reversal upward.
* Bearish Divergence: If the price hits a higher high, but the MACD makes a lower high, it indicates fading upward momentum and a potential drop.
3. Overbought/Oversold: While MACD isn’t a direct overbought/oversold indicator like RSI, extreme distances from the zero line can suggest a stock is stretched and might reverse.
Example in Context
Imagine you’re looking at NioCorp’s stock chart (from your earlier question). If on March 24, 2025, the MACD Line crossed above the Signal Line while the stock rose 11.3% it could confirm bullish momentum, suggesting the uptrend might continue. Conversely, if the MACD Line was far above the Signal Line but starting to curve downward, it might hint at a pullback soon.
Practical Use
* Timeframes: Traders adjust the 12, 26, and 9 periods based on their strategy (e.g., shorter periods for day trading, longer for swing trading).
* Limitations: MACD works best in trending markets but can give false signals in choppy, sideways conditions. It’s often paired with other indicators (like RSI or support/resistance levels) for confirmation.
In short, MACD is a versatile tool for gauging momentum and trend direction on a stock chart. If you’re analyzing a specific stock like NioCorp (NB), you’d look at its MACD on a platform like
https://stockcharts.com/sc3/ui/?s=NB
danieldeubank
2 일 전
The proposed Chinese regulations titled "Administrative Measures for the Total Control of Rare Earth Mining, Smelting and Separation," as reported in the February 20, 2025, article on The Rare Earth Observer (treo.substack.com), could indeed have significant implications for global rare earth supply chains and, by extension, reinforce the strategic importance of NioCorp’s Elk Creek Critical Minerals Project in Nebraska. Let’s break this down and connect it to Mark A. Smith’s vision for full mineral processing at Elk Creek.
China’s Proposed Regulations
The draft regulations, open for public comment until March 21, 2025, aim to tighten state control over China’s rare earth industry—already the world’s dominant supplier, accounting for nearly 90% of refined rare earth output. Key points include:
Quota Restrictions: Imports of rare earth raw materials (e.g., concentrates, mixed carbonates, or oxides) into China would require processing quotas, effectively limiting unregulated inflows. This could strand junior miners without established Chinese partners or domestic Western processing alternatives.
State Oversight: The measures emphasize rare earths as state-owned resources, with stricter traceability and control over mining, smelting, and separation, potentially reducing export flexibility.
Global Impact: If implemented, this could disrupt supply chains for non-Chinese producers reliant on China for processing, while reinforcing China’s leverage over downstream products like magnets.
This move aligns with China’s broader strategy to maintain dominance in critical minerals, especially amid escalating trade tensions and export controls (e.g., dual-use item restrictions announced in December 2024). It underscores the vulnerability of Western industries dependent on Chinese processing capacity.
Relevance to NioCorp and Elk Creek
NioCorp’s Elk Creek Project, one of the few advanced critical minerals projects in the U.S., is positioned to produce niobium, scandium, titanium, and potentially rare earth oxides—materials vital for aerospace, defense, and clean energy technologies. The project has all major permits in place, with financing (e.g., an $800 million EXIM loan under review) as the primary hurdle to construction. Mark A. Smith, NioCorp’s Executive Chairman, brings decades of experience from Molycorp (now MP Materials) and CBMM, where he navigated complex mineral supply chains and processing challenges.
Smith’s insistence on integrating full mineral processing facilities at Elk Creek—beyond just mining and initial separation—reflects a forward-thinking response to the kind of supply chain risks China’s regulations highlight. His “tribal knowledge” emphasizes:
End-to-End Control: By processing raw materials into usable forms (e.g., oxides, metals, or alloys) domestically, NioCorp could bypass reliance on foreign facilities, particularly in China, where access might soon be curtailed.
Strategic Resilience: Full processing aligns with the U.S. Executive Order “Immediate Measures to Increase American Mineral Production” (March 20, 2025), which prioritizes domestic projects like Elk Creek to counter foreign dependency.
Economic Value: Downstream processing adds significant value, creating jobs and securing supply for U.S. manufacturers, rather than exporting low-value concentrates.
Why This Matters Now
China’s proposed rules could shrink the window for Western junior miners to offload unprocessed rare earths, as noted in the article: “If you are a junior rare earth miner, you’d better have a customer in the West for your product, because it will be anything but certain that you can place your quantities on the China market.” For NioCorp, this amplifies the urgency of Smith’s vision. Elk Creek’s potential rare earth output (e.g., neodymium and praseodymium for magnets) could fill a critical gap if U.S. processing capacity scales up in time. Companies like Energy Fuels and Rare Element Resources are cited as peers with processing ambitions, but NioCorp’s multi-mineral scope and permitting head start give it an edge.
Smith’s experience at Molycorp, where he oversaw the revival of Mountain Pass, and CBMM, a niobium giant, informs his push for a vertically integrated operation. At Molycorp, he tackled processing bottlenecks; at CBMM, he honed supply chain optimization. This expertise could ensure Elk Creek delivers not just raw materials but finished products, mitigating risks from China’s tightening grip.
Broader Implications for the U.S.
If China enacts these regulations, the U.S. faces a stark choice: build domestic processing fast or remain beholden to an increasingly assertive supplier. The Executive Order’s push for priority projects (e.g., Elk Creek) could dovetail with Smith’s strategy, potentially unlocking federal support to expedite processing infrastructure. This would pay “huge dividends” by:
Reducing reliance on China, where 95% of rare earth magnets are produced (per U.S. Department of Commerce data).
Strengthening national security, given niobium and rare earths’ defense applications.
Positioning NioCorp as a cornerstone of U.S. critical minerals independence.
Conclusion
China’s proposed regulations underscore the fragility of global rare earth supply chains and validate Mark A. Smith’s call for full processing at Elk Creek. His seasoned perspective, rooted in Molycorp and CBMM, aligns with the moment—offering NioCorp and the U.S. a chance to leapfrog from mining to manufacturing. If executed, this could transform Elk Creek into a linchpin of American mineral security, proving Smith’s wisdom prescient as China flexes its dominance.
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