UCU.V – Ucore Uranium Sell-Off: Potential Red Flag For Rare Earth Element Stocks

by Olivier on November 17, 2009

Today’s sell-off in UCU.V – Ucore Uranium after news was released is a potential red flag for the Rare Earth Element sector. QUC.V – Quest Uranium was up and is holding up well above the recent private placement level at 2.30. RES.V – Rare Element Resources is doing rather well but is somehow caught in a consolidation pattern. I don’t see enough pressure indicating an imminent breakout to the upside. The stock needs more time to set up.

UCU.V - Ucore Uranium

Up-to-date UCU.V – Ucore Uranium Chart on my public list.

For AVL.TO – Avalon Rare Metals it is soon going to be decision time. Not exactly the strongest stock within the sector. It is trading near the apex of the triangle. Strong stocks tend to trade near the upper boundary of the triangle before breaking out to the upside. This doesn’t mean AVL.TO won’t be able to break out to the upside. I would simply let the stock show its hand before jumping in.

AVL.TO Avalon Rare Metals

Up-to-date AVL.TO Avalon Rare Metals Chart on my public list.

UCU.V – Ucore Uranium’s move today is significant as it weakens the picture of the overall sector. The best performance is achieved when a sector moves up in unison. This is not happening right now. Hence the term ‘red flag’. Nothing is written in stone though. It simply means additional caution is warranted if you have Rare Earth Element stocks in your portfolio.

For a quick and easy way to see if the REE sector is moving in unison check my REE Sector Overview Chart.

Have a great evening!

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