Underworld Resources – UW (TSX.V) Drill Results Trigger Sell-Off

by Olivier on June 23, 2009

So much for UW.V – Underworld Resources being one of my favourites. The market’s verdict is unambiguous. The expectations the stock had priced in were too high. Personally I don’t think the drill results were that bad but I am not going to argue with the markets. I see decent support in the 1.50- 1.60 area. If the stock goes below that level I will reduce my position.

The only meaningful observations I made today was the relative strength of the two Rare Earth Elements leaders AVL.TO – Avalon Rare Metals and RES.V – Rare Element Resources. Although I prefer AVL.TO I will add RES.V to my public list tonight. That will make it easier to monitor the sector. The other observation was a possible flushing out of weak hands in UXG – US Gold. But it is too early to tell yet. The stock would need to close above 2.30 – 2.40 to confirm that assumption.

Have a great evening!

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