Merv’s Weekly Uranium Review
for week ending 10 April 2009
See previous commentary on 09 April 2009 for the Thursday data and intermediate and short term commentaries. There is no use repeating them. Commentary reflecting primarily the long term is noted in this week-end section this week.
It’s been another snoozer of a week with the Merv's Weekly Uranium Index moving up but by only a very little amount. It was enough, however, to cause a difference of opinion between the Weekly and the Daily Indices. First, the data. The Weekly Index closed higher by 54.87 points or 1.45%. There were 25 weekly winners, 19 weekly losers and 6 going nowhere. Of those five largest stocks by market value, Cameco gained 1.7%, First Uranium lost 4.2%, Paladin lost 4.9%, Uranium One lost 1.8% and USEC gained 8,7%. The winner of the week award goes to Mega Uranium with a weekly gain of 25.6% while the loser of the week award goes to Wescan Goldfields with a weekly loss of 15.4%.
There is a little difference of opinion between the Daily and Weekly Indices as to the long term rating. This is because the long term Weekly moving average line has turned upwards while the long term Daily moving average line is still in a mild downward trend. I have explained this phenomena in the past. It is due to the calculation of the moving average using only the 40 Friday closing prices for the weekly versus the 200 closing prices for the Daily. They cover the same amount of territory but the Daily is, in my view, the more accurate. Both are giving the same story MOST of the time but at transition points they may differ for a week or more. That DOES NOT mean that the first one to upgrade (or down grade) its message is ahead of the game and is the true story. One should usually wait for BOTH to confirm each other unless one has other indicators that confirm the first reversal message.
Looking at both Indices we see that the Weekly Index has moved into new recovery highs while the Daily Index is still slightly below its previous recovery high of early January. This difference is more in the way each Index is calculated. As explained in earlier posts, the Daily Index is calculated based upon total summation of points moved by the 50 component stocks similar to the way the Dow Jones is calculated while the Weekly Index is calculated based upon the average weekly performance (% change) of the component stocks. The Daily usually favors the larger priced stocks and the Weekly usually favors the lower priced stocks. I would expect that when the Daily Index moves into new recovery highs its moving average slope will turn to the up side.
So, we have the Weekly Index above its positive sloping moving average line while the Daily Index is above its still downward sloping moving average line. In both cases their momentum indicators are giving an identical story. Both are still in their negative zones but above their positive sloping trigger line indicating the direction of motion is to the up side. Although the long term rating would now be a full bullish rating using the Weekly Index data I will go with what I think is the more accurate rating using the Daily Index, and that would be a continuation of last week’s + NEUTRAL rating.
for week ending 10 April 2009
See previous commentary on 09 April 2009 for the Thursday data and intermediate and short term commentaries. There is no use repeating them. Commentary reflecting primarily the long term is noted in this week-end section this week.
It’s been another snoozer of a week with the Merv's Weekly Uranium Index moving up but by only a very little amount. It was enough, however, to cause a difference of opinion between the Weekly and the Daily Indices. First, the data. The Weekly Index closed higher by 54.87 points or 1.45%. There were 25 weekly winners, 19 weekly losers and 6 going nowhere. Of those five largest stocks by market value, Cameco gained 1.7%, First Uranium lost 4.2%, Paladin lost 4.9%, Uranium One lost 1.8% and USEC gained 8,7%. The winner of the week award goes to Mega Uranium with a weekly gain of 25.6% while the loser of the week award goes to Wescan Goldfields with a weekly loss of 15.4%.
There is a little difference of opinion between the Daily and Weekly Indices as to the long term rating. This is because the long term Weekly moving average line has turned upwards while the long term Daily moving average line is still in a mild downward trend. I have explained this phenomena in the past. It is due to the calculation of the moving average using only the 40 Friday closing prices for the weekly versus the 200 closing prices for the Daily. They cover the same amount of territory but the Daily is, in my view, the more accurate. Both are giving the same story MOST of the time but at transition points they may differ for a week or more. That DOES NOT mean that the first one to upgrade (or down grade) its message is ahead of the game and is the true story. One should usually wait for BOTH to confirm each other unless one has other indicators that confirm the first reversal message.
Looking at both Indices we see that the Weekly Index has moved into new recovery highs while the Daily Index is still slightly below its previous recovery high of early January. This difference is more in the way each Index is calculated. As explained in earlier posts, the Daily Index is calculated based upon total summation of points moved by the 50 component stocks similar to the way the Dow Jones is calculated while the Weekly Index is calculated based upon the average weekly performance (% change) of the component stocks. The Daily usually favors the larger priced stocks and the Weekly usually favors the lower priced stocks. I would expect that when the Daily Index moves into new recovery highs its moving average slope will turn to the up side.
So, we have the Weekly Index above its positive sloping moving average line while the Daily Index is above its still downward sloping moving average line. In both cases their momentum indicators are giving an identical story. Both are still in their negative zones but above their positive sloping trigger line indicating the direction of motion is to the up side. Although the long term rating would now be a full bullish rating using the Weekly Index data I will go with what I think is the more accurate rating using the Daily Index, and that would be a continuation of last week’s + NEUTRAL rating.
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