Merv's Week-End Commentary, 29 Mar 2009

Merv’s Weekly Uranium Review
for week ending 27 March 2009

Merv’s Daily Uranium Index
Market Data for Friday 27 Mar 2009

Open: 146.97
Hugh: 148.42
Low: 139.84
Close: 144.12
Volume: 3628

Note that the volume is an average volume of round lot sales for the 50 component stocks. For total volume, multiply by 5000.

Monday was an up day and then we seemed to go to sleep with the rest of the week basically moving sideways. No real trend either way this past week. The Weekly Index shows a plus week overall but that was probably the result of Monday’s action. Looking at the Index alone one is hard up to guess what the Index has in store. When we go to the indicators at least we know where we are on any particular day. A technician then has his famous criteria that a trend remains in motion until it is confirmed to have reversed. So, for all intents and purposes we are still in a bull market, but let’s go through the routine and see what we really have for the three investment/speculative time periods.

On Friday the Merv’s Daily Uranium Index closed lower by 4.11 points or 2.77%. There were only 8 winners on the day, 30 losers and 12 stocks that couldn’t make up their minds which way to go. The five largest stocks knew which way to go, they all headed south. Cameco lost 3.7%, First Uranium lost 0.5%, Paladin lost 6.0%, Uranium One lost 1.1% and USEC lost 1.2%. The brightest and dullest stocks on the day really were lazy. The brightest stock was Xemplar Energy with a 6.7% gain while the dullest stock was Pinetree Capital with a loss of 9.4%.

On the week as a whole the Merv’s Weekly Uranium Index closed up by 91.97 points or 2.55%. That must still be a left over from the Monday move. There were 25 winners on the week, 24 losers and one unchanged. Basically a neutral week as far as the breadth of the market was concerned. As for those five largest stocks only one did not remain in the plus territory by Friday’s close. Cameco gained 2.8% on the week, First Uranium gained 5.0%, Paladin gained 3.8%, Uranium One gained 11.3% and USEC lost 7.0%. The best winner on the week was Benton Resources with a weekly gain of 43.2% while the loser on the week was Titan Uranium with a loss of 16.7%.

The long term rating is just hanging there and not yet going full bullish. Both the Weekly and the Daily Indices are above their long term moving average lines, however their lines are still pointing downward. The momentum indicator is still in its negative zone although above its positive sloping trigger line. From the Daily Index the volume indicator is still gung-ho positive and above its positive long term trigger line. All in all, the long term rating remains + NEUTRAL for another week.

On the intermediate term nothing seems to have changed over the past few days. The Daily Index remains above its positive moving average line and the momentum indicator remains in its positive zone above its positive trigger line. It is heading lower but has not crossed either line, the neutral line or the trigger line. As for the volume indicator, what can I say? It continues in its upward path above its positive trigger line. On the intermediate term the rating remains BULLISH.

As for the short term the Daily Index just touched the short term moving average line on Friday but bounced up and still closed above the line. The moving average line is also still pointing in an upward direction. The short term momentum indicator is showing signs of weakness and has moved below its trigger line. The trigger has also just turned to the down side. However, the momentum is still in its positive zone and although the direction is now downward it is still a positive momentum. The daily volume action is dull and what one expects during a lateral price drift. Putting all that together the short term is still rated as BULLISH.

The Stochastic Oscillator has now moved below its overbought line, below its trigger line and heading lower fast. It is, however, still in its positive zone. The Index closed on Friday just a shade below its very short term moving average line (not shown) but the line remains sloping upward. With the mixed messages given by the indicators I think the safest option is to remain with the lateral trend as the one with the least resistance.