After the Close, 29 Oct 2007Another great day for uranium stocks. The Merv’s Daily Uranium Index closed up 0.182 points or 3.75%. There were 37 stocks on the rise, 11 stocks on the decline and 2 going nowhere. Of the five largest stocks by market value, Cameco gained 1.0%, Denison gained 7.2%, Paladin gained 2.0%, UEX gained 4.2% and Uranium One gained 6.5%. The best daily performer was Powertech Uranium with a gain of 27.4% while the worst performer was once again Northern Continental with a loss of 11.5%.
Looking at the chart everything looks great from the intermediate term point of view. The Index continues to move higher, above a positively sloping moving average line (the 65 DMAw line). The price momentum continues to act very well and keeps on moving higher inside its positive zone. Even the volume is perking up. The only cautionary item is the fact that the Index is now butting up against that upper (resistance) trend line of the channel. We might see a reaction downward but if such is the case the reaction would most likely stay inside the channel, unless it is more than just a rest/reaction. The odds are, however, that the Index is more likely to break above the upper trend line rather than react lower from it. On the intermediate term I am still BULLISH on uranium stocks.
Short term we have a similar situation with the Index well above an aggressive upward trending moving average line. We now have both the short term momentum indicator and the more aggressive Stochastic Oscillator in their overbought zones. As mentioned before, going into the overbought zone is not necessarily time to panic, it’s when the indicators drop back below their overbought lines that one must then be on the watch for a good reaction. For now I go with the trend in motion and that is still a BULLISH short term trend.
No comments:
Post a Comment