Merv’s Daily Uranium Index
Note that the volume is an average volume of round lot sales for the 50 component stocks. For total volume, multiply by 5000.
Oh oh! We have just broken below that P&F support that has been there for over a year. This does not bode well for the general Index trend. On an intra-day basis we were at the lowest point since mid-April 2009 and on the close we are also at the lowest point since mid-April 2009. It looks like we are heading back toward the previous bear market low of 100 on the P&F or 92 on the daily Candlestick chart. Only time will tell what’s happening.
P&F charts are one of the best ways to estimate the potential of a move. This is especially true on the up side. My experience has been that the initial projection, at the initial upside break, is accurate at least 80% of the time, primarily for stocks but also for Indices. As the move progresses and new higher projections can be calculated these projections become less and less reliable.
Looking at the chart the up move on the left side had an initial projection to 480, which was met. As the trend moved higher we were able to calculate a few more projections, one at the 450 level was to the 660 price, which was not met.
On the way down we were able to calculate several projections, all of which were met except the last one. The straight drop from 290 down to 160 gave us a vertical count and projection to the 50 level. Today’s downside break would give us a projection to MINUS 50. This is one hazard of projections on the down side. Stocks can go up into the stratosphere with nothing stopping the move but on the down side stocks or Indices cannot go lower than zero. Today’s move should see support at the previous bear market low although that projection to PLUS 50 is still operative.
The Merv’s Daily Uranium Index closed lower by 3.98 points or 2.57%. There was only one stock on the up side today, 41 on the down side and 8 on no side. Cameco lost 1.5%, Extract was the lone gainer with a gain of 1.6%, Paladin lost 2.6%, Uranium One lost 3.9% and USEC lost 2.9%. The best winner of the day was that one winner, Extract, with a gain of 1.6%. The loser of the day was Blue Sky Uranium with a loss of 34.4%. I have not had a change to check this stock to see if there was some kind of distribution or reverse split or something to cause the drop. Market Vectors Nuclear Energy ETF lost 4.5%.
To cut it short, everything is negative so the ratings for the intermediate or short term remain BEARISH. One of these days I’ll get it right but I’ll stick with the lateral as the direction of least resistance although I should really go with the downside.