Washington isn’t leaving this one to the free market.
When it comes to the metals that power the clean energy transition and AI - lithium, nickel, cobalt, and rare earths - governments around the world have decided these resources are too important to ignore.
From national subsidies to strategic stockpiles and full-scale industrial policy, the “Green Revolution” trade has shifted from a market-driven narrative to a geopolitical priority.
Look no further than MP Materials $MP, America’s biggest rare earth producer. The company has received direct U.S. government support because policymakers recognize the significant stakes involved.
Without a secure supply of rare earths, lithium, and battery materials, there is no electrification for AI, no energy transition, and no chance of competing with China, which dominates much of this supply chain.
That’s what makes the ASC Green Revolution Index so powerful. It tracks an equal-weight basket of Rare Earth Metals $REMX, Lithium $LIT, Cobalt futures, and Nickel futures.
After a brutal bear market, this group is finally bottoming and setting up for a bullish reversal:
After the ASC Green Revolution Index peaked in early 2022, the index was left for dead, falling nearly 70% from its high to its low.
However, in 2024, it stopped falling and began to carve out a massive bearish-to-bullish reversal pattern. Now, the price is pressing against the upper bound of this range, which conveniently aligns with the 61.8% retracement level of the historic 2020 - 2022 uptrend.
A breakout here would mark the beginning of a brand-new primary uptrend and ignite the next phase of the Green Revolution trade.
One way to express this theme is through the Global X Lithium & Battery Tech ETF $LIT.
The Global X Lithium & Battery Tech ETF chart bears an eerie resemblance to our ASC Green Revolution Index, pressing against the upper bound of a massive base.
The LIT portfolio includes downstream users, such as Tesla $TSLA, alongside producers like Albemarle 8.2%. That makes it a pure play on both the producers and consumers of rare earths.
We want to own LIT above 47.50, with a target of 58 over the coming 3-6 months.
For most investors, LIT offers a liquid and diversified vehicle for participating in this move. But for those looking for real juice - the kind of trade that can double your money - you need to see this week’s Commodities Trade of the Week below.
We also outlined a few other rare earth names in July, which are still actionable.
