for week ending 21 August 2009
Merv’s Daily Uranium Index
Market Data for Friday 21 Aug 2009
Note that the volume is an average volume of round lot sales for the 50 component stocks. For total volume, multiply by 5000.
Note that additional charts of the Daily and Weekly Indices were posted earlier and should be viewed during this commentary.
It’s been 9 weeks now that the Weekly Index has been below its intermediate term moving average line or at best sitting on top of it. This has the feel of a topping process. Looking at the Daily Index posted earlier one can see the volume indicator going through a topping process similar to the bottoming process it went through in Nov and Dec. With the weakness shown in the momentum indicators and the strong resistance at the 180 level that the Daily Index seems not to be able to breach, something has to happen, and soon, or else this has the smell of more downside. I may have my personal hopes and wishes but in the end I must go to the charts and indicators and follow their lead.
The Merv’s Daily Uranium Index closed the week with a slight up move on Friday. It was up 2.74 points or 1.62%. There were 27 winners, 16 losers and 7 that still don’t know what to do. Those five largest stocks were confused also as some closed up and some closed down. Cameco gained 0.8%, First Uranium lost 1.7%, Paladin lost 0.5%, Uranium One lost 0.8% and Uranium Participation gained 1.0%. The best daily winner was Mega Uranium with a gain of 13.6% while the loser of the day was Alberta Star with a loss of 10.7%.
For the week as a whole, the Merv’s Weekly Uranium Index closed the week lower by 141.14 points or 2.72%. On the week there were 14 winners, 33 losers and 3 confused. Of the five largest, Cameco lost 0.3%, First Uranium lost 17.2%, Paladin lost 3.1%, Uranium One lost 6.8% and Uranium Participation lost 1.0%. The best weekly winner was Western Uranium with a weekly gain of 13.3% while the loser of the week was Forsys Metals with a loss of 19.2%.
While the Weekly and Daily Indices are moving in a basic sideways path the respective long term moving average lines continue to move higher slowly closing the gap between the two. Depending upon the Index movement next week the gap could get closed although I would think that there is still a few weeks grace before the gap gets closed. That is assuming the Indices do not take off on the up side. The long term momentum indicators of the Daily and Weekly are still in a conflict with the Daily continuing to move sideways in its negative zone and the Weekly moving somewhat lower in the positive zone. The Weekly momentum is very close to breaking below its neutral line and joining the Daily momentum in the negative zone. The volume indicator continues to move in a basic lateral direction but with a negative bias. It is below its negative trigger line. For this week the long term rating remains unchanged at BULLISH but is getting vary precarious.
On the intermediate term although the trend is lateral the basic indicators are mixed. The Daily Index remains just very slightly below its negative sloping moving average line. The momentum indicator continues to move sideways hugging its neutral line but just slightly on the positive side. The volume indicator, as mentioned earlier, appears to be going through a topping process and is just below its negative sloping trigger line. From all this, and going to my secret formula for determining bulls and bears, the rating becomes a – NEUTRAL rating for this week.
On the short term things look a little bit brighter but not by much. The Daily Index closed on Friday just a hair above its moving average line and the line just turned oh so gently to the up side. Nothing of any strength but still on the plus side. The momentum indicator also just peaked its head above its neutral line and above its positive trigger line. The daily volume activity still leaves a lot to be desired and is the one real worrying indicator. Still, for today the short term is rated as BULLISH.
With the Stochastic Oscillator heading towards its neutral line (but not quite there yet) and the Daily Index having three higher lows and higher highs in a row it looks like the direction of least resistance would be towards the up side.