Uranium Stocks Continue Their Bullish Action

Dines Letter (05/15/2009)
"The good news is that the charts of the uranium stocks continue their bullish action, having broken their downtrend lines and completed their base formations with gratifying upside breakouts. Uranium's 'spot' price got as high as $51 on 11 May 09, up 27.5% from its low at 40 on 6 Apr 09, but we have limited regard for the volatile spot price. The spot price is really the plaything of aggressive short-term traders and purveyors of small lots. The main action is the determined, sustained, conservative buying by electric utilities in the long-term market, and that 'term' price is still an impressive eight times higher than our original recommended price of $8/lb.

We were also impressed by how broad based the strength in uranium stocks was, even including Upside breakouts by companies forced to delay activities due to aboriginal issues, so we suspect that the Obama Administration might finally be seeing the radioactive light and will at some point move decisively toward nuclear power. Weakness might merely be ordinary breakout pullbacks in preparation for the next wave of confirmatory upside breakouts. Maybe it's just that too many investors were beginning to agree with our optimism, and DIMAPSO [the Dines Mass Psychology Oscillator] has resultantly tamped them back down with market weakness.

Whatever, we expect much higher term uranium prices due to the looming shortage in the next few years. We still predict that a historic commodity bull market began in 2001, that it is not over despite the crash of 2008 that hurt virtually everybody's portfolios, and we note that our bullishness on other energy groups are being rewarded by uptrends: for example, crude oil, heating oil and natural gas."

 PRINT THIS PAGE   EMAIL THIS PAGE

Under SEC rules, analysts are required to disclose their interest in securities that they cover. We strongly encourage you to contact them to understand any potential conflicts of interest they may have.

Related Quotes: