Merv’s Weekly Uranium Review
for week ending 01 May 2009
Merv’s Daily Uranium Index
Market Data for Friday 01 May 2009
Open: 175.73
Hugh: 186.60
Low: 171.55
Close: 182.40
Volume: 8099
Note that the volume is an average volume of round lot sales for the 50 component stocks. For total volume, multiply by 5000.
Another good day at the market, but it looks like the rally is losing steam. Although the Daily Index closed at a new recovery high the volume indicator has not confirmed the move. It is still lower than its previous high of a day or so ago. As mentioned on Thursday, one should not dread a rest or reaction period. It is a period that one can often buy stocks that one initially missed during the upward spurt. The only caution is to keep your exit strategy actively working as surprises DO happen and although things may look great for a continued bull market, markets reverse when one least expects.
The Merv’s Daily Uranium Index closed on the up side on Friday, up 6.65 points or 3.78%. There were 34 daily winners, 9 daily losers and 7 stocks going nowhere. The five largest stocks by market value closed on the up side. Cameco gained 6.4%, First Uranium gained 2.5%, Paladin gained 2.9%, Uranium One gained 3.9% and USEC gained 4.0%. The best daily winner was Dejour Enterprises with a gain of 19.5% while the loser on the day was Mawson Resources with a loss of 12.3%.
As for the week as a whole, the Merv’s Weekly Uranium Index closed the week up 853.07 points or 18.43%. This compares with a weekly gain by the Daily Index of only 11.17%. Although the difference is only 7% this represents a difference of over 60% in the weekly performance. As I have often mentioned, because of the way each Index is calculated the Weekly Index favors the low priced stocks while the Daily Index favors the high priced stocks. The low priced speculative stocks took over in the weekly performance. Getting back to the weekly information there were 41 weekly winners, 6 weekly losers and 3 going nowhere. With the great weekly performance I’m surprised there were any weekly losers. As for those five largest stocks, Cameco gained 15.6%, First Uranium gained 8.8%, Paladin gained 4.0%, Uranium One gained 3.9% and USEC gained 4.4%. Compare these gainers versus the weekly Top 10 list posted earlier. What a difference. The best weekly winner was Bayswater with a weekly gain of 85.7% while the loser of the week was East Asia Minerals with a loss of 10.4%.
Where the market is for the various time periods should be easy this week. Starting with the long term and looking primarily at the Weekly Index we see that the Index is gung-ho on the up side, far and away above its long term positive moving average line. The long term momentum indicator is also in its positive zone above its positive sloping trigger line (not shown). Looking at the long term indicators on the Daily Index the basic difference is that the momentum indicator has not yet moved into its positive zone but is moving upwards above its positive trigger line and could get into the positive zone shortly. As for the volume indicator, that is still positive and has been above its positive trigger line since the beginning of the year, well ahead of any of the other long term indicators. On the long term the BULLISH rating is the only logical rating.
On the intermediate term things are just too good. Technicians are always looking for trend lines, support and resistance levels, and the like. Well, not drawn on the chart but if you take the November and March lows and draw a support trend line you can then draw a parallel resistance line through the November, January and recent highs and get an up trending channel. Now, although the trend seems to be very strong the recent action is at the upper resistance line so from this one is cautioned that the most likely activity over the next few weeks may be sideways or downward, back towards the lower support line. That’s the probability, now, where are we exactly as far as the intermediate term indicators are concerned?
The Daily Index remains well above its positive moving average line. The momentum indicator is in its positive zone above a positive sloping trigger line. The volume indicator remains in a positive trend above its positive sloping trigger line. As mentioned above, the volume indicator may be still rated as positive but it has been performing badly as far as the relationship between it and the Index price is concerned. A reduction in volume activity as the Index (or stock) is reaching new highs is so often a sign of an over extended trend, ripe for a reaction. However, as to what all this tells us about the intermediate term rating right at this moment, it is still very BULLISH.
On the short term, here we expect to see any reversal of trend show up first. One should expect the short term to go negative without the other time periods following suit, during a reaction within a bull market. It’s when the other time periods start to follow the short term in changing direction one needs to worry about. For now there is still no turn around in the trend although there is some initial suggestion of topping. The Index activity over the past few days could be thought of as a topping activity until proven otherwise. The short term momentum indicator is inside its overbought zone ready to move below its overbought line for a reaction signal, but it’s not quite there yet. It still remains above its positive trigger line. The daily volume activity is not too encouraging in that the down side volume action is as high as the up side and the Friday volume was low compared to previous days. The Daily Index is still above a very aggressive positive sloping moving average line keeping the trend fixed on the up side. For now the short term rating remains BULLISH but cautionary.
As for the immediate direction of least resistance, I would keep with the lateral direction for now. Although the Index has not yet reversed its upward direction it is also not looking like the up trend is firm.
If you are an intermediate or long term speculator the Weekly or Daily Tables will do you service. If you are a short term trader I would not be inclined to use the Weekly table for information. The Daily Table should be used for technical or trending information.
Again, I hope to be able to find the time to post a few individual stock charts but you’ve heard this before. Believe it when you see it, I just might surprise you this coming week.
for week ending 01 May 2009
Merv’s Daily Uranium Index
Market Data for Friday 01 May 2009
Open: 175.73
Hugh: 186.60
Low: 171.55
Close: 182.40
Volume: 8099
Note that the volume is an average volume of round lot sales for the 50 component stocks. For total volume, multiply by 5000.
Another good day at the market, but it looks like the rally is losing steam. Although the Daily Index closed at a new recovery high the volume indicator has not confirmed the move. It is still lower than its previous high of a day or so ago. As mentioned on Thursday, one should not dread a rest or reaction period. It is a period that one can often buy stocks that one initially missed during the upward spurt. The only caution is to keep your exit strategy actively working as surprises DO happen and although things may look great for a continued bull market, markets reverse when one least expects.
The Merv’s Daily Uranium Index closed on the up side on Friday, up 6.65 points or 3.78%. There were 34 daily winners, 9 daily losers and 7 stocks going nowhere. The five largest stocks by market value closed on the up side. Cameco gained 6.4%, First Uranium gained 2.5%, Paladin gained 2.9%, Uranium One gained 3.9% and USEC gained 4.0%. The best daily winner was Dejour Enterprises with a gain of 19.5% while the loser on the day was Mawson Resources with a loss of 12.3%.
As for the week as a whole, the Merv’s Weekly Uranium Index closed the week up 853.07 points or 18.43%. This compares with a weekly gain by the Daily Index of only 11.17%. Although the difference is only 7% this represents a difference of over 60% in the weekly performance. As I have often mentioned, because of the way each Index is calculated the Weekly Index favors the low priced stocks while the Daily Index favors the high priced stocks. The low priced speculative stocks took over in the weekly performance. Getting back to the weekly information there were 41 weekly winners, 6 weekly losers and 3 going nowhere. With the great weekly performance I’m surprised there were any weekly losers. As for those five largest stocks, Cameco gained 15.6%, First Uranium gained 8.8%, Paladin gained 4.0%, Uranium One gained 3.9% and USEC gained 4.4%. Compare these gainers versus the weekly Top 10 list posted earlier. What a difference. The best weekly winner was Bayswater with a weekly gain of 85.7% while the loser of the week was East Asia Minerals with a loss of 10.4%.
Where the market is for the various time periods should be easy this week. Starting with the long term and looking primarily at the Weekly Index we see that the Index is gung-ho on the up side, far and away above its long term positive moving average line. The long term momentum indicator is also in its positive zone above its positive sloping trigger line (not shown). Looking at the long term indicators on the Daily Index the basic difference is that the momentum indicator has not yet moved into its positive zone but is moving upwards above its positive trigger line and could get into the positive zone shortly. As for the volume indicator, that is still positive and has been above its positive trigger line since the beginning of the year, well ahead of any of the other long term indicators. On the long term the BULLISH rating is the only logical rating.
On the intermediate term things are just too good. Technicians are always looking for trend lines, support and resistance levels, and the like. Well, not drawn on the chart but if you take the November and March lows and draw a support trend line you can then draw a parallel resistance line through the November, January and recent highs and get an up trending channel. Now, although the trend seems to be very strong the recent action is at the upper resistance line so from this one is cautioned that the most likely activity over the next few weeks may be sideways or downward, back towards the lower support line. That’s the probability, now, where are we exactly as far as the intermediate term indicators are concerned?
The Daily Index remains well above its positive moving average line. The momentum indicator is in its positive zone above a positive sloping trigger line. The volume indicator remains in a positive trend above its positive sloping trigger line. As mentioned above, the volume indicator may be still rated as positive but it has been performing badly as far as the relationship between it and the Index price is concerned. A reduction in volume activity as the Index (or stock) is reaching new highs is so often a sign of an over extended trend, ripe for a reaction. However, as to what all this tells us about the intermediate term rating right at this moment, it is still very BULLISH.
On the short term, here we expect to see any reversal of trend show up first. One should expect the short term to go negative without the other time periods following suit, during a reaction within a bull market. It’s when the other time periods start to follow the short term in changing direction one needs to worry about. For now there is still no turn around in the trend although there is some initial suggestion of topping. The Index activity over the past few days could be thought of as a topping activity until proven otherwise. The short term momentum indicator is inside its overbought zone ready to move below its overbought line for a reaction signal, but it’s not quite there yet. It still remains above its positive trigger line. The daily volume activity is not too encouraging in that the down side volume action is as high as the up side and the Friday volume was low compared to previous days. The Daily Index is still above a very aggressive positive sloping moving average line keeping the trend fixed on the up side. For now the short term rating remains BULLISH but cautionary.
As for the immediate direction of least resistance, I would keep with the lateral direction for now. Although the Index has not yet reversed its upward direction it is also not looking like the up trend is firm.
If you are an intermediate or long term speculator the Weekly or Daily Tables will do you service. If you are a short term trader I would not be inclined to use the Weekly table for information. The Daily Table should be used for technical or trending information.
Again, I hope to be able to find the time to post a few individual stock charts but you’ve heard this before. Believe it when you see it, I just might surprise you this coming week.
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