Merv's Daily Commentary, 17 Mar 2009

After The Close, 17 Mar 2009

Merv’s Daily Uranium Index
Market Data

Open: 130.33
High: 135.88
Low: 125.07
Close: 132.89
Volume: 7914

Note that the volume is an average volume of round lot sales for the 5 0 component stocks. For total volume, multiply by 5000.

That’s a little better. Now, it’s starting to look like the upper resistance line of the channel just might get broken during this run. The short term momentum has already broken above its upper resistance, can the Index be far behind. It’s interesting to note that all three basic time period moving average lines are quite close together. A good rally move and all three may get broken setting us up for a long term bull market. But that’s still sometimes ahead. Let’s keep it one day at a time and take things as they come.

The Merv’s Daily Uranium Index closed on the up side today, by 3.78 points or 2.93%. There were 32 winners, 17 losers and only one going nowhere. As for those five largest stocks, they were all on the up side for an average 5% advance between the five. Cameco gained 5.5%, Paladin gained 10.5%, Uranium One gained 2.7%, Uranium Participation gained 2.0% and USEC gained 4.6%. The best performer on the day was Mega Uranium with a gain of 24.0% while the loser on the day was Forsys Metals with a loss of 14.6%.

Things are perking up for the intermediate term although not yet to the point of going bullish. The Index is just a touch below its negative sloping moving average line. The momentum indicator is still in its negative zone but moving upwards and is above its positive sloping trigger line. The volume indicator, which has been the one bright spot during the past few weeks, is zooming into the stratosphere and is in new recovery highs, above its positive trigger line. Go volume go. However, the intermediate term despite the positive trending of the indicators, is still rated as BEARISH at this point. Another day or two of positive movement and the intermediate term should improve.

Short term had already gone bullish and remains so. The Index is moving farther and farther away from its short term moving average line, on the up side, and the moving average is turning further to the up side. The momentum indicator has now moved into its positive zone above its positive trigger line. As mentioned above, the momentum has now broken above its upper resistance channel trend line. Very often the trends are more accurate in the momentum indicator, and this seems like one of those times. As for the daily volume indicator, that is also perking on the up side. All in all, the short term rating remains BULLISH.

Without going into any detailed analysis, if you should want to get in on the present, what looks like the start of a new move, take a quick look at Mega Uranium, Paladin and UEX. They seem to have volume on the up side with new moves starting. There are others but at this point I haven’t had a chance to review the full complement of stocks.