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Premier African Minerals (PREM) Shares Rally 6.67% Trying To Break Above Resistance

Simon Mugo trader
Updated 25 May 2021

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Premier African minerals trucks

Shares of Premier African Minerals Ltd (LON: PREM) rallied 6.67% in an attempt to break above the resistance level shown in the table below that previously acted as support.

Premier African Minerals has not made a positive announcement recently, so its shares lack momentum and keep trading sideways.

However, the lithium mining company’s fundamentals remain solid after being awarded an exclusive prospecting license for the Zulu Lithium and Tantalum mines in Zimbabwe.

The lithium mining company is far from starting mining operations to capitalise on the growing demand for battery metals such as lithium fueled by the shifting consumer preferences for electric cars and gadgets.

The last time we covered PREM shares, we noted that the lithium mining company’s shares were trading sideways at the support level, now turned resistance as the bulls and the bears fought for control.

PREM shares have since broken below the support level but do not seem to be under significant bearish pressure given the latest attempt to rally higher. The lack of positive announcements from the company held back the rally attempt as the buyers lacked conviction.

Regardless, I would refrain from establishing a bullish position at current prices until the shares are back above the resistance level. I would wait for at least two daily candle closes above the level before opening new trades.

In the meantime, I’ll keep monitoring the stock to see if the bulls shall take complete control of the company’s shares price and push it higher.

*This is not investment advice.

PREM share price.

IG chart of PREM share price 25-05-2021

Premier African Minerals shares rallied 6.67% to trade at 0.16p, rallying from Monday’s closing price of 0.15p.

Should you invest in Premier African Minerals shares?

Premier African Minerals shares are traded on the London stock exchange's AIM market (the alternative investment market), which is the submarket specifically for smaller companies. AIM stocks are attractive to investors as they have tax advantages and smaller companies have the potential to benefit from rapid growth. But are PREM shares the best buy? Our stock market analysts regularly review the market and share their picks for high growth companies

Simon has over six years of professional trading experience across FX, commodities and equities. He has a strong passion for financial markets and is particularly focused on price action trading