The S&P/ASX 200 Materials Index (ASX: XMJ) is up 0.85% in late afternoon trading, but this ASX lithium share is outperforming the index.
Atlantic Lithium Ltd (ASX: A11) shares soared 14.6% in earlier trade today from 41 to 47 cents apiece. However, the company's share price has since given back some of its gains and is now up 8.5% to 44.5 cents. For perspective, the S&P/ASX 200 Index (ASX: XJO) is currently 0.68% higher.
So why is this ASX lithium share having such a top run today?
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What's going on?
Atlantic Lithium is developing the Ewoyaa lithium project in Ghana, West Africa. This project is funded via an agreement with Piedmont Lithium Inc (ASX: PLL).
Despite today's gains, Atlantic Lithium's share price has shed a mammoth 34% in the past month. It seems the company has recently been exposed to a short attack from Blue Orca.
However, as my Foolish colleague James reported today, it may be that short sellers are now closing their positions or investors believe Atlantic Lithium shares were sold off unfairly amid the attack.
Last week, Blue Orca alleged in a short-seller report that Atlantic Lithium derived key Ghana mining licenses by "making secret payments" and "promises of payment" to the immediate family of a high-level Ghana politician.
This led to both Atlantic Lithium and its partner Piedmont Lithium entering a trading halt last week.
However, on Friday, Atlantic Lithium denied the claims and described Blur Orca's report as "false and misleading".
Atlantic Lithium said:
The company holds valid prospecting licences with operating permits for all of its current activities, in accordance with the Ghanaian government and the Minerals Commission's requirements, and outrightly refutes the allegations of impropriety made by the report.
Atlantic Lithium cautions investors not to make decisions based on the report, which it considers factually untrue.
Share price snapshot
The Atlantic Lithium share price has lost 23% in the last year.
For perspective, the ASX 200 has slipped 0.56% in the past 12 months.
This ASX lithium share has a market capitalisation of nearly $269 billion based on the current share price.
