The price of uranium has moved up again from $54 per pound to $55.75 according to the UX Consulting Group. The price of Uranium is accelerating and would appear to have entered a period of increasing price momentum.

The end users have got the message, no nuclear energy without uranium so get out there and get it bought. The question that still puzzles us though is why are the uranium stocks so sluggish? Is this market so thin that the investment fraternity overlook it as too small to be meaningful? Is it lost behind the glitter of gold and silver?

Looking at the Uranium stocks we can see that Cameco is trading at a disappointing $34.31. We are not sure why this is as it would be the ideal vehicle for a fund management group to invest in. Then there is Crosshair that we have just bought which is also down slightly. Then we look at Fronteer Development Group and the price is up from when we bought it at $4.70 to $5.47 a rise of some 16%. However Fronteer has a gold element to it and maybe that is why it was attractive to the investment market. But gold prices are getting a bit of a hammering right now so one could be forgiven for expecting this stock to go lower.

We can only conclude that with the progress that uranium has made so far the uranium stocks must surely follow. So we will continue to buy as the opportunities present themselves and when the cash becomes available. We would be more uncomfortable holding these stocks if uranium was heading south but that is clearly not the case and our research still points to $100 for uranium.

05 October 2006