This week brings good price action for uranium bulls like our colleagues Marin Katusa, Chris Mayer, and Matt Badiali…
The bull case for uranium – the chief fuel for nuclear reactors – is that "emerging" Asian nations are embarking on a building spree of nuclear plants to meet a portion of their growing electric needs. Meanwhile, new supply is unlikely to rise in lockstep with all this new demand.
These factors produced a more than 10-fold rise in uranium from 2003 to 2007… The end of that rally was fueled by speculators, who helped produce a subsequent crash. This crash hammered uranium prices and the companies associated with the stuff. But as you can see from today's chart of Uranium Participation Corp, uranium investment is getting a little "less bad" these days.
Uranium Participation Corp is no mining or exploration company. It's simply an investment vehicle that hoards uranium and acts like an exchange-traded fund for the stuff. The stock has been locked in a major downtrend over the past few years. But over the past few weeks, it has broken out of this downtrend. It's no sure indicator the bear market in uranium is over, but it's a step in the right direction…
No comments:
Post a Comment