Merv's Daily Commentary 17 Aug 2009

After The Close, 17 Aug 2009

Merv’s Daily Uranium Index
Market Data

Open: 170.87
High: 173.54
Low: 166.09
Close: 169.88
Volume: 4142

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

How fast things can change, especially when the Index is very close to its various moving average lines and the indicators are toying with their neutral levels. Today was a bad day. Now, was it because of the overall markets or is there something going on in the uranium area that we don’t yet fully understand? The Index dropped significantly but as yet there is not much concern. The Index has been bouncing around that third FAN trend line and is once more toying with it.

The Merv’s Daily Uranium Index closed lower by 6.03 points or 3.43%. There were only 3 stocks brave enough to move higher while we had 44 that just gave up the ghost and moved lower. Three stocks were totally confused. As for those biggies, Cameco lost 2.4%, First Uranium lost 5.8%, Paladin lost 5.0%, Uranium One lost 4.3 and coming back into the top five fold is Uranium Participation with a loss of 2.3%. The best of those 3 winners was Uracan Resources with a gain of 11.9% while the worst of all those 44 losers was Energy Fuels with a loss of 19.2%.

What can I say? With a negative move like today and the Index so close it its moving average line the Index just had to close below the line and the line followed right behind with a turn downwards in its slope. The momentum indicator continues to move lower below its negative trigger line but is still just very slightly above its neutral line in the positive zone. The volume indicator remains below its negative trigger line. Once more the intermediate term rating has reversed back to a BEARISH rating.

The short term is no better. The Index is below its negative moving average line and the momentum indicator has now entered its negative zone below its negative trigger line. The daily volume action is no great shakes either. On the short term the rating is once more BEARISH.

As for the direction of least resistance, one might expect that to be to the down side but I think it would be more like lateral again. It looks like the Index moves in a basic lateral direction most of the time so maybe if I just said lateral every day I could be right most of the time. Hmmmm – have to think that over.