I have had a weekly close below my support line for my gigantic monthly falling wedge as my measure for if we have a new bull market in uranium or not. This week we got that close, a weekly close below that support line. This is serious. But is the sector down and out? No, I do not think so and I will here try to explain why not and how I see it.
On further inspection of the charts it looks like price when BT this major support line is choosing to use both my mentioned main support line for my gigantic monthly falling wedge, and also one of the important trend lines that I have had in my charts. And this important trend line is the main reason why I do not think the sector is down and out. Other reasons being changed necklines for my DBs and also that my weekly charts for the leaders are looking great still.
Alright, above you have my thinking in broad terms, now let´s turn those words into charts. Many indicators are looking very good but I will not comment on that for each and every chart.
Let´s start with the uranium price since there is where the foundation is for the sector, here in the form of the price proxy U.TO. Keeping in mind at the same time that most miners do not sell at this price but for a much higher price based on future delivery long term deals.
Below we have my weekly and my monthly. Here we can see the important black thin trend line I mention above and which I have had on the chart all along. The weekly close below the support line of the gigantic monthly falling wedge was not great to see but as said above, I do not think this means that we are not in a new bull market still. I mean, considering how large that monthly falling wedge is it is not the end for the new bull market I think if we dip just below it as we have right now. But if price starts to drop below this important trend line with a weekly close below it, that would probably mean that we are still in Weinstein stage 4 or 1. But as long as that does not happen we are still in a new bull market for uranium as I see it.
Looking at the 2h and daily for U.TO below, I think we have a DB in the making. If we compare them with the weekly and monthly above, it is obvious that the base line for the DB is exactly where the ultimate long term important black thin trend line mentioned above is.
Moving on to the main ETF for the sector, URA, we have the 2h and daily below. The 2h looks a bit awful isolated but looking at the daily right after eases the mind. The neckline on the daily is adjusted and with the new position the chart looks very nice. Also, I think the 2h is in for an around the apex move, look at the indicators.
Looking at the weekly and monthly for URA below, with the adjusted DB neckline, we can see that all is well in uranium land. These are not charts in distress, quite the opposite.
Turning our attention now to the ratio between URA and U.TO. Below we have the daily and the weekly and they are looking more than great I would say.
Staying with my ratio charts, below we have three weekly charts showing $SPX:URA, U.TO:$CRB and U.TO:$GOLD. The two first ones are telling me that U.TO is in a new bull market and the last one needs a bit more time but I do think it will BO. Do have an extra long look at that $SPX:URA chart as it is very telling.
As a last chart group I want to look at the individual miners and my weekly charts for a couple of the leaders in the sector. All below are still looking real good I would say. The drop for Cameco this week was because of reporting losses but I do not think that is anything to worry about going forward looking at the report. I think the market has overreacted which is very common.
And if we have a look at three of my favourite micro explorers below they are looking very nice too.
So, in sum, as I see it, uranium is still in a new bull market that started in Nov 2016, when I called it to the day almost, below. The miners are looking good and U.TO is hanging on by its teeth right now. I think U.TO are in for a DB right now on the 2h and daily.
I would even say that right now is a fantastic buying opportunity, as long as my important black thin trend line on the weekly and monthly does not experience a weekly closing below it. And I do not think we will experience that. Furthermore, the charts for the leaders above would never look like they do if we were not in a new bull market for uranium, as I see it.