for week ending 18 June 2010
Merv’s Daily Uranium Index
Market Data for Friday 18 Jun 2010
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.
Sorry for the missed post on Thursday. Other commitments took over. Well, nothing much happened anyway so let’s get to it.
The week was a real snoozer. It was sideways all the way with very little up or down movement after Monday’s small rise. Unfortunately, this has the looks of a topping process as suggested by the Stochastic Oscillator, which seems to have topped out and is reversing its direction. The next few days should be interesting. If this is a top, is it minor or major? I think it would be minor and the 145 level will hold, but what do I know?
One way to assess what trend we are in is to check out the recent highs and lows in the Index. For a bullish trend one is looking for low, high, higher low and then a higher high. For a bearish trend one would see a high, low, lower high and then a lower low. You must have that fourth peak or valley to establish a trend. If you do not yet have a higher high you do not yet have a bull trend. If you do not have that lower low you do not have a bear trend. We do not yet have that higher high to establish a bullish pattern. The indicators are basically confirming that view.
The Merv’s Daily Uranium Index closed on Friday on the up side by 0.49 points or 0.32%. There were 18 winners, 22 losers and 10 sleepers. Cameco gained 0.8%, Extract was a sleeper, Fronteer lost 5.3%, Paladin gained 2.0% and Uranium One gained 5.0%. The best daily winner was JNR Resources with a gain of 12.9% while the loser of the day was Uranium Resources with a loss of 11.6%. Market Vectors Nuclear Energy ETF gained 1.1%.
For the Week as a whole the Merv’s Weekly Uranium Index closed higher by 40.95 points or 0.98%. There were 25 weekly winners, 22 losers and 3 sleepers. Cameco gained 2.0% on the week, Extract gained 3.4%, Fronteer lost 4.9%, Paladin gained 2.9% and Uranium One gained 3.1%. The best weekly winner was JNR Resources with a gain of 29.6% while the worst weekly loser was Wealth Minerals with a weekly loss of 15.8%. Market Vectors Nuclear Energy ETF gained 3.8%.
The long term continues with its in sync performance between the two Indices. Both the long term Daily and Weekly Indices are telling the same story. Both Indices are below their negative moving average lines. Both momentum indicators are in their negative zone. The volume indicator continues to move in a lateral direction with a negative bias. It remains below its negative trigger line. All in all, both the Daily and Weekly Indices are BEARISH, long term wise.
On the intermediate term the Daily Index remains below its negative sloping moving average line. The momentum indicator remains in its negative zone but has just inched above its trigger line. The trigger has also very slightly turned to the up side. The volume indicator has inched above its trigger line and the line has turned to the up side. However, the indicator is still below a several week resistance level that it must breach if it is to show any strength. On the intermediate term the rating remains BEARISH. The short term moving average line continues below the intermediate term line for confirmation of the bear. The short term moving average line has started to turn upwards and is in the process of closing the gap between it and the intermediate term line but it will still be days before they could cross.
On the short term things are a little brighter. Although the week’s activity has been basically sideways the Daily Index has remained above the short term moving average line all week. The line itself has now turned slightly upward. The momentum indicator, although still in its negative zone, continues to push higher and higher towards its neutral line and above its positive trigger line. As for the daily volume activity, Friday was better than recent activity but still we need more of it. On the short term the rating remains BULLISH. The very short term moving average line crossed above the short term line on Friday confirming the bull.
As for the immediate direction of least resistance, unfortunately it looks like some minor down side activity might be ahead. I don’t think it will be serious but the very short term indicators do not justify going to the up side as the least resistance direction. I will go with the lateral direction for another day and see what is happening on Monday.