The more I watch how the Uranium stocks trade during the day the more I am starting to think this could indeed be the start of something really big. My reasoning is as follows: Before I entered DNN / DML.TO – Denison Mines I had a a very specific idea of what to expect. I outlined my thoughts early on in the following articles:
- Uranium Price Turnaround
- U.TO Uranium Participation Idealized Chart – Trade Entry Thoughts
- U.TO – Uranium Participation – Chart Technicals Improving
I was basically predicting and making educated guesses based on what I saw developing in the charts. The important thing to keep in mind though, is to let the market confirm your opinion. The huge buying pressure I see with uranium stocks so far is confirming my assumptions. Whenever that happens and the market shows me a profit it is time to get more aggressive. Put another way, it is time to think about adding to positions and to initiate new positions in the Uranium sector. That’s what I will be doing. In the end all my buying and selling decisions will be based on what the charts tell me to do.
I don’t think there’s a need to rush things as I see great potential for price moves to the upside in the months ahead. When I look at the Uranium charts and the prevailing sentiment it reminds me of roughly 6 years ago. That was the time to load up on physical gold and silver as prices were starting to break out in Euro terms. It was the signal the precious metals bull market was broad based and not limited to gold priced in US Dollars. The way I see it, market participants are extremely underinvested when it comes to Uranium. People thought buying gold and silver then was a crazy thing to do. And I am being very conservative with the choice of my words here… Know anybody who is bullish Uranium? Know anybody who truly believes Uranium and Nuclear Energy is the only viable solution to the world’s energy needs? I guess you get my point.
Now you might ask why I chose DNN over DML.TO although DML.TO is more liquid.The reason is the following: The US market is much bigger. If we are to witness a Uranium boom or what some already call a Uranium Renaissance, US based funds will look to position themselves accordingly. In my opinion DNN offers outstanding potential in terms of visibility. DNN operates in a safe jurisdiction, is extremely high grade, actually some of the highest grades on earth and it has a highly coveted US listing. Good enough for me.
You might also want to have another look at the list of world reactors I posted in my Weekend Reading to get an idea on how future demand will most likely impact Uranium prices going forward.
I believe right now betting on higher Uranium prices is a high odds proposition. Great value and now the charts are clearly in breakout mode. The amount of volume coming into the stocks is telling the story. I will probably add a third Uranium sector overview to my public list soon. For now you can check the following ones containing:
- U.TO – Uranium Participation, DNN / DML.TO – Denison Mines, PDN.TO – Paladin Energy, LAM.TO – Laramide Resources, HAT.V – Hathor Exploration, UEX.TO – UEX Corp., CCJ / CCO.TO – Cameco, BSK.V – Blue Sky Uranium, FIS.V – Fission Energy, KIV.V – Kivalliq Energy, URE.TO – Ur-Energy, FRG.TO – Fronteer Development Group.
- A few that come to mind that are not included yet: UEC – Uranium Energy, URZ – Uranerz Energy, JNN.V – JNR Resources, TUE.V – Titan Uranium, STM.V – Strathmore Minerals, FIU.V – First Uranium, CXZ – Crosshair Exploration, RSC.TO – Strateco Resources, URRE – Uranium Resources, MGA.TO – Mega Uranium, UUU.TO – Uranium One, USU – Usec, UWE.V – U3O8 Corp., BAN.TO – Bannerman Resources
- Uranium – Sector Overview Chart I.
- Uranium – Sector Overview Chart II.
- Uranium – Sector Overview Chart III.
- Uranium – Sector Overview Chart IV.
My public list with all my charts can be viewed here:
- MMR McMoRan Exploration – Incredible Buying Pressure – Technical Update
- Uranium Mining Stocks List – BSK.V – Blue Sky Uranium, UEX.TO, DML.TO, LAM.TO, PDN.TO, HAT.V
- BSK.V – Blue Sky Uranium: Ross Beaty Lumina Capital Investment Building Pressure
- Uranium Participation U.TO TSX Technical Picture Improving
- West Timmins Mining WTM (TSX) – Buying Pressure Is Building
- Uranium Price Turnaround – Some Technical Analysis Thoughts