The Uranium sector is breaking upward from a bull flag/corrective consolidation channel
While some stocks went up (especially in the Oil/Gas and Fertilizer/Ag sectors) and many went down during the worst of the war related headlines (and in software, the AI-mageddon hype), stocks in the Uranium sector maintained an orderly correction/consolidation that began pre-war.
The sector finally came to a technical “buy” as it generally tested the uptrending 200 day moving averages (orange line on the chart below) and maintained its major uptrend. When is an optimum time to buy a market or stock? During a correction within an intact uptrend, that’s when.
Indeed, we noted it in an NFTRH+ update (now public) on April 8th. From the update:
But when I look at uranium charts I see ‘buy opportunity’, in the technicals. One such chart is the ETF, URNM, on which I increased my position. It hit resistance today and recoiled. I bought that recoil. But it does need to clear resistance and the 50 day average, and hold them to clearly project a rally to new highs.
The update included a couple individual uranium stocks, but for sector management, the Sprott ETF, URNM works well. Both resistance (now support) and the SMA 50 have been cleared. Per the update quoted above, the near-term target is new highs.
Added subsequently was the Sprott Physical Uranium Trust, SRUUF, which had also been in an orderly correction since well before the war drums were heard. This fund broke down from the bullish pattern breakout for a test of of its uptrending SMA 200 and is now back above the pattern breakout line. A little unfinished business that it needed to see to, perhaps?
You don’t need me to pound tables on the fundamentals for the Uranium sector. It is an alternative energy source in a world once again reminded of the perilous state of oil dependence. With global growth reasserting, energy needs multiplying and oh yes, all those AI data-centers springing up, Uranium will be in demand for the long run.
There are fundamentals and then there are technicals. The current daily chart technicals are bullish and targeting new highs.
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