Merv’s Weekly Uranium Review
for week ending 17 April 2009
Merv’s Daily Uranium Index
Market Data for Friday 17 Apr 2009
Open: 151.32
Hugh: 154.75
Low: 146.31
Close: 150.00
Volume: 6068
Note that the volume is an average volume of round lot sales for the 50 component stocks. For total volume, multiply by 5000.
The week wasn’t so bad. Although it may not show up on the Daily chart the Weekly shows almost a start of a run-away.
For those new to this blog, and as I describe briefly on the front (above) I maintain two separate Uranium Indices, both using the exact same component stocks. The Weekly Index is calculated only once per week and uses the Friday closing prices. The Daily Index is calculated every day after the close of the markets and uses the full range of open, high, low, close and volume. For want of a definition, the Weekly Index is based upon the AVERAGE weekly performance of all the component stocks while the Daily Index is calculated based upon the summation of dollar moves of all stocks, similar to the method used to calculate the Dow Jones Industrial Average. The Daily favors the high priced stocks while the weekly favors the low priced stocks. With these two Indices one gets a feel for what’s going on in the uranium stock market.
As for the Candlestick method used to depict the daily activity, a quick review of the chart may be in order. Instead of the usual bar found in most charts a candlestick bar (candle) has a rectangular box between the high and low prices. The rectangular bar represents the opening and closing daily prices. If the daily bar is green in color that implies that the closing price today was higher than the previous close. A red bar implies a lower closing price versus the previous close. If the rectangular box is not fully colored that implies that the opening price is the lower box price and the closing price is the upper box price. If the box is fully colored, whether red or green, that implies that the opening price is at the upper end of the box and the closing price is at the lower end. As I had mentioned in commentaries in the recent past, you could have a green bar (candle) indicating that the price closed higher than the day before and at the same time have the box fully colored implying that the closing price was lower than the open. There are books on analyzing this activity presented by the candles but that’s for your own to do if you are interested.
Back to the market, the Merv’s Daily Uranium Index closed on Friday slightly on the down side. The Index lost 1.12 points or 0.74%. There were 18 daily winners, 25 daily losers and 7 going nowhere. As for the five largest stocks by market value, Cameco lost 1.1%, First Uranium lost 3.2%, Paladin gained 4.8%, Uranium One gained 3.1% and USEC gained 2.2%. The best winner on the day was Dejour Enterprises with a gain of 18.9% while the loser on the day was Bannerman with a loss of 12.0%.
As for the week as a whole, the Merv’s Weekly Uranium Index gained 230.55 points or 6.01%. By comparison, the Daily Index gained only 2.68% on the week. The lower priced stocks were moving better than the high priced ones. There were 29 weekly winners, 16 weekly losers and 6 going nowhere. The five largest stocks were mixed for the week. Cameco lost 0.7% on the week, First Uranium lost 5.2%, Paladin gained 12.9%, Uranium One gained 12.8% and USEC gained 0.5%. The best weekly winner was Powertech Uranium with a weekly gain of 46.0% while the weekly loser was almost a tie. Bannerman lost 20.6% while Western Prospector lost 20.8%.
Having both a Weekly Index and a Daily Index comes in handy to see some difference in the activity of various levels of stocks. As mentioned last week, the Weekly Index chart shows the Index in new recovery highs and above a positive long term moving average line. The Daily Index does not yet show the Index in new recovery highs and the long term moving average is still very, very slightly pointing downward. What this seems to be telling us is that the lower priced more speculative stocks are out performing the higher priced more quality oriented stocks. This is to be expected. However, for the uranium (or any other) market to continue a sustained advance it needs the quality stocks to be in step with the speculative stocks. The Privates do not long move forward if the Generals are lagging behind. My long term rating is based upon a review of the Daily Index and its long term indicators, with one eye on the Weekly Index for confirmation. So where are we this week?
Looking at the Weekly Index we see the move seeming to be accelerating upward but still not with too much vigor. The Index is above its long term moving average line and the line continues to point upward. The Daily Index is not as robust but is above its long term moving average line. The line, however, is still pointing very, very slightly lower. As for the momentum indicators, both the Weekly and Daily Indices are providing the same story. The momentum indicators are still in their negative zones but above their respective positive trigger lines. From the Daily chart we get the action of the volume indicator. Here, the indicator is very much in the positive having once more made new all time highs on Thursday but dropped very slightly on Friday. The volume indicator remains above its positive trigger line. All in all, I will continue to rate the long term based upon the Daily Index and stick with last week’s + NEUTRAL rating. Using the Weekly Index would have given us a full bullish rating.
On the intermediate term things are more settled. The Daily Index remains above its positive moving average line and the momentum indicator remains in its positive zone above its positive trigger line. The momentum indicator did make a new recovery high while the Index fell just a fraction short. This is a good sign but now we want to see that Index make a new high. The volume indicator remains above its positive sloping trigger line. Finally, the short term moving average continues to move above the intermediate term for additional confirmation the move remains positive on the intermediate term. The intermediate term rating remains BULLISH.
On the short term everything here too is looking rosy. The Index remains above its positive sloping moving average line although the daily action has been toying with the average lately. The daily lows have been touching the short term moving average but has continually bounced upwards and closed well above. The momentum indicator remains in its positive zone above its positive trigger line. Unfortunately, the short term momentum is giving us a short term negative divergence picture which is a warning that the strength of the recent Index moves may not be what they seem. Using short term indicators these divergences are not as powerful or as likely to predict correctly BUT they must be watched and not dismissed. The daily volume activity has been perking up but still some distance from enthusiastic. All in all, despite the momentum warning, the short term rating continues to be BULLISH.
As for the immediate direction of least resistance, I’ll stick with my Thursday view and go with the lateral direction until something better is shown on the charts.
I will be on the move for the next week or two but will try to post regularly, especially if something important should happen. However, don’t hold me to every day posting.
for week ending 17 April 2009
Merv’s Daily Uranium Index
Market Data for Friday 17 Apr 2009
Open: 151.32
Hugh: 154.75
Low: 146.31
Close: 150.00
Volume: 6068
Note that the volume is an average volume of round lot sales for the 50 component stocks. For total volume, multiply by 5000.
The week wasn’t so bad. Although it may not show up on the Daily chart the Weekly shows almost a start of a run-away.
For those new to this blog, and as I describe briefly on the front (above) I maintain two separate Uranium Indices, both using the exact same component stocks. The Weekly Index is calculated only once per week and uses the Friday closing prices. The Daily Index is calculated every day after the close of the markets and uses the full range of open, high, low, close and volume. For want of a definition, the Weekly Index is based upon the AVERAGE weekly performance of all the component stocks while the Daily Index is calculated based upon the summation of dollar moves of all stocks, similar to the method used to calculate the Dow Jones Industrial Average. The Daily favors the high priced stocks while the weekly favors the low priced stocks. With these two Indices one gets a feel for what’s going on in the uranium stock market.
As for the Candlestick method used to depict the daily activity, a quick review of the chart may be in order. Instead of the usual bar found in most charts a candlestick bar (candle) has a rectangular box between the high and low prices. The rectangular bar represents the opening and closing daily prices. If the daily bar is green in color that implies that the closing price today was higher than the previous close. A red bar implies a lower closing price versus the previous close. If the rectangular box is not fully colored that implies that the opening price is the lower box price and the closing price is the upper box price. If the box is fully colored, whether red or green, that implies that the opening price is at the upper end of the box and the closing price is at the lower end. As I had mentioned in commentaries in the recent past, you could have a green bar (candle) indicating that the price closed higher than the day before and at the same time have the box fully colored implying that the closing price was lower than the open. There are books on analyzing this activity presented by the candles but that’s for your own to do if you are interested.
Back to the market, the Merv’s Daily Uranium Index closed on Friday slightly on the down side. The Index lost 1.12 points or 0.74%. There were 18 daily winners, 25 daily losers and 7 going nowhere. As for the five largest stocks by market value, Cameco lost 1.1%, First Uranium lost 3.2%, Paladin gained 4.8%, Uranium One gained 3.1% and USEC gained 2.2%. The best winner on the day was Dejour Enterprises with a gain of 18.9% while the loser on the day was Bannerman with a loss of 12.0%.
As for the week as a whole, the Merv’s Weekly Uranium Index gained 230.55 points or 6.01%. By comparison, the Daily Index gained only 2.68% on the week. The lower priced stocks were moving better than the high priced ones. There were 29 weekly winners, 16 weekly losers and 6 going nowhere. The five largest stocks were mixed for the week. Cameco lost 0.7% on the week, First Uranium lost 5.2%, Paladin gained 12.9%, Uranium One gained 12.8% and USEC gained 0.5%. The best weekly winner was Powertech Uranium with a weekly gain of 46.0% while the weekly loser was almost a tie. Bannerman lost 20.6% while Western Prospector lost 20.8%.
Having both a Weekly Index and a Daily Index comes in handy to see some difference in the activity of various levels of stocks. As mentioned last week, the Weekly Index chart shows the Index in new recovery highs and above a positive long term moving average line. The Daily Index does not yet show the Index in new recovery highs and the long term moving average is still very, very slightly pointing downward. What this seems to be telling us is that the lower priced more speculative stocks are out performing the higher priced more quality oriented stocks. This is to be expected. However, for the uranium (or any other) market to continue a sustained advance it needs the quality stocks to be in step with the speculative stocks. The Privates do not long move forward if the Generals are lagging behind. My long term rating is based upon a review of the Daily Index and its long term indicators, with one eye on the Weekly Index for confirmation. So where are we this week?
Looking at the Weekly Index we see the move seeming to be accelerating upward but still not with too much vigor. The Index is above its long term moving average line and the line continues to point upward. The Daily Index is not as robust but is above its long term moving average line. The line, however, is still pointing very, very slightly lower. As for the momentum indicators, both the Weekly and Daily Indices are providing the same story. The momentum indicators are still in their negative zones but above their respective positive trigger lines. From the Daily chart we get the action of the volume indicator. Here, the indicator is very much in the positive having once more made new all time highs on Thursday but dropped very slightly on Friday. The volume indicator remains above its positive trigger line. All in all, I will continue to rate the long term based upon the Daily Index and stick with last week’s + NEUTRAL rating. Using the Weekly Index would have given us a full bullish rating.
On the intermediate term things are more settled. The Daily Index remains above its positive moving average line and the momentum indicator remains in its positive zone above its positive trigger line. The momentum indicator did make a new recovery high while the Index fell just a fraction short. This is a good sign but now we want to see that Index make a new high. The volume indicator remains above its positive sloping trigger line. Finally, the short term moving average continues to move above the intermediate term for additional confirmation the move remains positive on the intermediate term. The intermediate term rating remains BULLISH.
On the short term everything here too is looking rosy. The Index remains above its positive sloping moving average line although the daily action has been toying with the average lately. The daily lows have been touching the short term moving average but has continually bounced upwards and closed well above. The momentum indicator remains in its positive zone above its positive trigger line. Unfortunately, the short term momentum is giving us a short term negative divergence picture which is a warning that the strength of the recent Index moves may not be what they seem. Using short term indicators these divergences are not as powerful or as likely to predict correctly BUT they must be watched and not dismissed. The daily volume activity has been perking up but still some distance from enthusiastic. All in all, despite the momentum warning, the short term rating continues to be BULLISH.
As for the immediate direction of least resistance, I’ll stick with my Thursday view and go with the lateral direction until something better is shown on the charts.
I will be on the move for the next week or two but will try to post regularly, especially if something important should happen. However, don’t hold me to every day posting.
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