Merv's Daily Commentary, 17 Apr 2008

After The Close, 17 April 2008

Since I revised the Index scale the other day I though I’d show what the short term Point & Figure chart looks like.

Another small move to the up side and with every small move that brings us closer to some major event. We are just about to break above that long shown third FAN trend line. At the same time we should also break above the short term P&F down trend line. There still is the resistance to break through, both on the P&F and from the “box”. Keep your fingers crossed for a quick break.

The Merv’s Daily Uranium Index closed higher by 3.15 points or 1.11%. There were 25 winners, 20 losers and five going nowhere. Of the five largest stocks Cameco gained 1.5%, Denison gained 4.0%, First Uranium went nowhere, Paladin gained 2.8% and Uranium One gained 2.6%. The best performer on the day was Western Prospector with a gain of 16.0% while the worst performer was US Energy with a loss of only 5.5%.

The intermediate term is slowly coming towards some kind of change. It could be an upside adjustment to the ratings or it could just be a topping area prior to a further drop in price without any break-out. For now everything remains as it has for weeks. The rating remains BEARISH.

On the short term things are continuing to improve. The Index remains above its short term moving average line and the line is sloping to the up side. The momentum indicator continues to move higher towards its neutral line but is still inside its negative zone. The indicator is above its positive sloping trigger line. The momentum indicator continues to suggest more strength behind the Index moves than is suggested by the Index itself. Let’s hope the Index perks up pretty fast. For today the short term rating remains BULLISH.

CAUTION

Of concern for any further possible upside action is the fact that the latest uranium price posted by The Ux Consulting Co. LLC (check the link section) had uranium at a new bear market low at $68.00, down $3.00 from last week. This does not bode well for uranium stocks. Of course uranium stocks are usually looking ahead and they may be seeing something that the market for uranium itself is not yet reflecting. However, be warned.