Is Uranium The Next Copper?
The uranium market has been under pressure this year as the spot price of the commodity has dropped by almost half since the beginning of 2016. Last week the spot price of uranium closed at $18/lb. However, miners often lead the commodity higher. With Cameco (TSX:CCO) leading the surge, the rest of the pack appears to be following. The price action I’ve been noticing in uranium stocks are beginning to appear very similar to that of the copper stocks before their recent powerful surge to new 52 week highs.
If you are a contrarian investor, the demand for uranium should pick up as more nuclear reactors are brought online. A supply deficit could prove to be a tailwind for pricing. Just like today, in 2004 the spot price of uranium was sub $20/lb. Although, by mid 2007 investors who participated saw the spot price soar to $137/lb. The President-elect Donald Trump victory probably doesn’t hurt this thesis either.
Cameco Corp. (TSX:CCO)
Cameco leading the way:
Uranium Participation (TSX:U)
Uranium Participation, which tracks price of uranium is up against resistance, although the RSI(14) & PMO are showing positive divergence:
NexGen Energy (TSX:NXE)
NexGen Energy is consolidating within a bull flag continuation pattern. All indicators appear to be tired, my next signal would be a breakout above the bull flag pattern drawn on chart:
Ur-Energy, Inc. (TSX:URE)
Ur-Energy is breaking out above Volume By Price resistance:
Denison Mines (TSX:DML)
Denison Mines is bumping its head against Volume By Price resistance. Indicators show money flowing into this name. A breakout above the Volume By Price resistance drawn on the chart would be extremely bullish:
Fission Uranium (TSX:FCU)
Fission Uranium is up against Volume By Price resistance. The money flow indicators at the bottom of the chart appear to be very strong. A breakout above this Volume By Price level would be very bullish:
Paladin Energy (TSX:PDN)
Paladin Energy showing an interesting surge in volume. Paladin was a market darling during the last bull market in uranium:
Have a great day! 🙂
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