Sociedad Quimica y Minera de Chile Skyrockets 8.3%—Is This the Dawn of a Lithium Bull Run?

Summary
• SQM surges 8.3% intraday, hitting 52-week high of $47.36
• CATL’s Jiangxi mine closure sparks 3% jump in lithium carbonate prices
• Options frenzy: 20250815C42.5 call sees 205% price change ratio

Sociedad Química y Minera de Chile (SQM) has ignited a firestorm in the lithium sector, surging 8.3% to a 52-week high of $47.36 amid a perfect storm of supply-side shocks and speculative fervor. The stock’s meteoric rise follows the abrupt closure of Contemporary Amperex Technology Co. Ltd.’s (CATL) Jiangxi mine, a facility accounting for 6% of global lithium output. With lithium carbonate prices spiking to 75,500 yuan/ton and options volatility exploding, the question looms: Is this a fleeting spike or the start of a sustained lithium renaissance?

CATL Mine Closure Sparks Lithium Price Surge and SQM Rally
SQM’s 7.21% intraday surge is directly tied to the shutdown of CATL’s Jiangxi mine, a critical node in the global lithium supply chain. The mine’s closure—triggered by an expired permit—has exacerbated fears of supply tightness, pushing lithium carbonate prices up 3% to 75,500 yuan/ton. Analysts at Macquarie Capital note that while CATL claims minimal operational impact, the broader sector’s oversupply concerns are being recalibrated in real time. SQM, as a dominant player in Chilean lithium production, stands to benefit from reduced global output, with its operations positioned to capitalize on the tightening supply dynamics.

Lithium Sector Unites as Supply Fears Drive Broad Rally
The lithium sector is rallying in unison, with Albemarle (ALB) surging 7.64% and Tianqi Lithium (002460.SZ) jumping 19% in Hong Kong. SQM’s 7.21% gain aligns with the sector’s 15% average intraday move, reflecting a shared exposure to supply-side shocks. While SQM’s 23.5x dynamic P/E is slightly above the sector’s 21x average, its 52-week high of $47.36 suggests strong conviction in its long-term lithium dominance. The sector’s synchronized move underscores the interconnectedness of global lithium producers, with CATL’s actions acting as a catalyst for a broader re-rating of strategic resources.

Options Frenzy: High-Leverage Calls Lead the Charge
• MACD: 0.568 (bullish divergence), Signal Line: 0.586, Histogram: -0.018 (flattening)
• RSI: 59.3 (neutral), Bollinger Bands: 42.44 (upper), 38.415 (middle), 34.3855 (lower)
• 200D MA: 37.61 (below current price), 30D MA: 37.92

SQM’s 16.5% premium to its 200-day moving average and RSI near neutral suggest bullish momentum is intact. Two options stand out for aggressive positioning:

• 20250815C42.5 (Call, $42.5 strike, 8/15 expiry):
- IV: 53.05% (moderate)
- Leverage Ratio: 15.57% (high)
- Delta: 0.844 (deep in-the-money)
- Theta: -0.368 (rapid time decay)
- Gamma: 0.085 (moderate sensitivity)
- Turnover: $470,929 (high liquidity)
- Payoff at 5% upside ($47.528): $5.028/share
• 20250919C45 (Call, $45 strike, 9/19 expiry):
- IV: 45.87% (moderate)
- Leverage Ratio: 15.30% (high)
- Delta: 0.551 (moderate)
- Theta: -0.057 (slow time decay)
- Gamma: 0.058 (moderate sensitivity)
- Turnover: $3,829 (reasonable liquidity)
- Payoff at 5% upside ($47.528): $2.528/share

Aggressive bulls should consider 20250815C42.5 for immediate upside capture, while 20250919C45 provides a more measured approach. If $47.36 holds, the 200-day MA at $37.61 becomes a critical support level. Watch for follow-through volume in the 20250815C42.5 call as a key liquidity barometer.

Backtest Sociedad Quimica y Minera de Chile Stock Performance
Sociedad Quimica y Minera S.A. (NYSE: SQM) experienced a notable intraday surge of 8% on August 11, 2025. To assess the stock's performance following this event, we can consider the following points:1. Post-Surge Performance: The 8% intraday surge in SQM's stock price on August 11, 2025, represents a significant positive movement. To evaluate the stock's performance after this surge, we would look at its trading activity, investor sentiment, and any subsequent news or events that may have influenced the stock's trajectory.2. Investor Sentiment and Trading Activity: On August 11, 2025, SQM saw a notable increase in trading volume, indicating heightened investor interest and activity. This could be indicative of market participants responding to the surge and potentially adjusting their positions accordingly.3. Subsequent Price Movement: It's important to analyze the stock's performance in the days and weeks following the surge. If the positive momentum continued, it would suggest that the market was receptive to the news or events that drove the initial surge. Conversely, a decline in the stock's price could indicate a lack of sustained positive sentiment.4. Market Reaction and News: Assessing any relevant news or market reactions to the surge is crucial. If the surge was driven by positive news or broader market conditions, the stock's performance after the initial surge might be influenced by ongoing market dynamics.5. Technical Analysis: Examining technical indicators such as support and resistance levels, trend lines, and moving averages can provide insights into the stock's potential future performance. If the surge pushed the stock above key resistance levels, it could signal a continuation of the positive trend.In conclusion, to fully backtest SQM's performance after the 8% intraday surge, one would need to consider the stock's subsequent trading activity, investor sentiment, any relevant news or events, and technical indicators. This comprehensive analysis would provide a clearer picture of the surge's impact and the stock's potential future trajectory.

Bullish Momentum Intact—Position for SQM's Next Move
SQM’s 7.21% surge is a textbook reaction to a supply-side shock, with technicals and fundamentals aligning for a sustained rally. The stock’s 52-week high of $47.36 and 23.5x P/E suggest undervaluation relative to its strategic lithium assets. Sector leader Albemarle (ALB) surging 7.64% reinforces the sector’s strength. Traders should monitor the 200-day MA at $37.61 as a key support level and watch for follow-through volume in the 20250815C42.5 call. With CATL’s mine closure sparking broader anti-involution policies, the lithium sector is poised for a re-rating—position now for SQM’s next move.