Uranium Stocks A Dead Cat Bounce?
Monday, April 6, 2009 at 11:23PM
Uranium Stocks in Uranium Mining Stocks
Uranium Chart u3o8 07 apr 09
Chart courtesy of u308.biz.

When we scan the horizon in this tiny sector we can see that a number of uranium stocks have improved dramatically since their low point at the close of 2008 in what could be a dead cat bounce. Is this the beginning of a recovery, well we certainly hope so, however, we must keep these recent improvements in context. The fact of the matter is that they have been decimated with some stocks down as much 97% so an improvement since Christmas of two to three hundred percent is nothing to celebrate but it is step in the right direction. If you are a new comer to this market sector then these gains are the stuff of your wildest dreams however if you have been involved for sometime the road to recovery is a long one.

Apart from one or two mentions this sector is attracting very little in terms of air play as the mainstream continues to wrestle with the results and ramifications of G20, IMF gold sales, bailouts for the banks and just where can we hide those toxic non-performing assets? In the meantime the spot price for uranium drifts in a southerly direction and is currently trading at $42/lb as depicted by the above chart according to both TradeTech and UxC.

The longer term uranium price remains steady at $70/lb which is depicted by the chart below kindly provided by TradeTech

TradeTech chart long term uranium price 07 apr 09

Over at NYMEX the futures prices for uranium range from $42/lb for June 2009 to $52/lb for December 2009 delivery.

Apart from the occasional pop northwards by a stock, such as Denison putting on a 26.29% gain yesterday, the order of the day appears to be a fairly static one. The broader markets have put in a terrific spurt over last four weeks and may now take a breather, if they do sell off we suspect that it will put a damper on this sectors progress as the financial turmoil tends to cloud the real issue of just where we are going to get the power from in the not too distant future.

Have a good one.

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