The recent news that RPT is extending its winter diamond drilling programme in the Split Rapids area of the Black Sturgeon uranium property in the Sibley basin northeast of Thunder Bay, Ontario, has helped to push the stock price higher. The company released news in early April of on the intersection of high-grade uranium mineralization: 4.68% U3O8 over 0.72 metres, which has no doubt given them the impetus to explore further.

Since then they have been actively engaged in raising capital to order to finance their exploration programme. Add to this a recommendation by Analyst Daniel Earle of Fraser Mackenzie whose coverage of RPT Uranium Corporation was initiated with a “strong buy” rating and pieces of the jigsaw are starting to fall into place. They may be small but they do have a property showing good results, they also have the ability to raise cash and they are starting to get some airtime in the form of analyst’s coverage. These are good signs as there are other uranium explorers out there that cannot claim any of the above.

As you may recall we made an investment on the 19th February 2007 at $0.42 and it has been a volatile few months for this uranium stock as we can see from the chart below:

Chart:

The stock has rallied in recent months and is now challenging its recent highs. It closed on Friday at $0.56 which $0.14 for a gain of 33% in about 4 months, which we are pleased to report. However we must observe that the stock price has run a long way ahead of its 200 Day Moving Average and the technical indicators are all on the high side. This does not mean that it cannot go higher but it is now vulnerable to profit taking. So the next week or so could see a sell off in RPT.

On the other side of this coin however we have the underlying asset of uranium, which is performing its socks off as each piece of news appears to push the spot price even higher. Uranium stocks in general have looked a little sluggish when compared to uranium so far this year so either they are telling us that the price of uranium is unsustainable or that they have a lot of catching up to do.

You could decide to sell RPT today in anticipation of a sell off. Then watch for a suitable re-entry point and hope that you can buy RPT later on at a lower price than it is now. This is a dangerous move given the momentum of the price of uranium, which must be attracting the attention of investors who are looking to take part in this hot market sector. RPT’s emergence as an investment vehicle might be just the ticket for them to play this market.