for week ending 25 June 2010
Merv’s Daily Uranium Index
Market Data for Friday 25 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.
On Monday the Daily Index tried to rally but the rally spluttered out and it has been basically down hill for the rest of the week. We are presently sitting right on top of a support from two weeks back. Now to see if it will hold. Nothing in the various indicators is giving us any great encouragement of a reversal of trend. On the other hand, nothing is really saying we are in for a catastrophe ahead.
The Merv’s Daily Uranium Index closed on Friday higher by 1.40 points or 0.95%. There were 25 winners, 13 losers and 12 slackers. Cameco gained 1.4%, Extract was one of those slackers, Fronteer gained 2.7%, Paladin gained 0.3% and Uranium One gained 2.0%. The best winner of the day was Uranium Resources with a gain of 9.0% while the worst loser of the day was Wealth Minerals with a loss of 8.6%. Market Vectors Nuclear Energy ETF gained 1.4%.
For the full week the Merv’s Weekly Uranium Index lost 136.56 points or 3.22%. There were 15 weekly winners, 29 losers and 6 slackers. Cameco lost 3.1%, Extract gained 1.6%, Fronteer lost 3.7%, Paladin lost 4.5% and Uranium One gained 11.6%. The best weekly winner was Blue Sky Uranium with a gain of 12.7% while the worst weekly loser was Uranium Resources with a weekly loss of 26.6%. Market Vectors Nuclear Energy ETF lost 3.3% on the week.
Looking at the long term charts posted previously one can see a difference in the performance of the Weekly versus the Daily Index. The Daily Index is still holding above its recent lows while the Weekly Index is continuing to move into new lows. What this tells us is that the smaller, more aggressive stocks are continuing to get hit while the larger quality stocks seem to be reaching a bottom. This is to be expected. The gambling variety of stocks are most often hardest hit and for a longer time BUT when the turn comes they are also the ones where one can make the most profits percentage wise. Of course this is only an advantage if you have sold out off the stocks moving lower and are holding the cash ready to jump in when the time comes. Riding a stock all the way down and all the way back gets you nowhere. This is the common buy and hold mentality.
From the long term perspective nothing much has changed over the past week. The long term changes very slowly. Both the Daily and Weekly Indices are below their negative sloping moving average lines. Both momentum indicators are in their negative zones but there is a slight difference in their recent performances. The Daily long term momentum indicator is moving sideways while the Weekly one is still moving lower and lower, showing the greater weakness in the smaller stocks versus the larger ones. Although moving sideways the Daily momentum is still below its negative trigger line. The volume indicator is also in a sideways trend but below its negative trigger line. Both Indices long term ratings are BEARISH.
For the intermediate term the Daily Index is just below its negative sloping moving average line. The momentum indicator is in its negative zone but crossing its trigger line almost on a daily basis. Today it is just below its negative trigger line. The volume indicator isn’t going anywhere, up or down and like the momentum indicator it keeps crossing its trigger line. Any little change in daily closing price and the momentum and volume indicators seem to cross their trigger lines. Today, the volume indicator is just below its trigger line. On the intermediate term the rating remains BEARISH with the short term moving average line confirming the rating.
The short term is where to look for your first sign of a turn around. Unfortunately, that’s not today. The Daily Index is below its negative trigger line. The momentum indicator remains in its negative zone but ready to move into the positive with only a couple of days of positive action. The indicator is just about touching its negative trigger line from below. The daily volume action continues to be low, which is expected. The short term rating remains BEARISH but could quickly change. The very short term moving average has moved below the short term average for confirmation of the bear.
As for the immediate direction of least resistance, I’m going with the up side today. The Stochastic Oscillator seems to be bouncing off its oversold line and has just barely crossed above its trigger line. Previous such action indicated the very start of a minor rally so I’ll go with that.