Admittedly, we provide more than average coverage on uranium stock UEC (Uranium Energy Corp). That is really on purpose, because this is the ultimate stock in the uranium mining space which gives investors leverage during a uranium mining bull market.
That is because UEC stacked uranium during the 5 year bear market with the intent to start selling it only as uranium prices start rising. That is a very smart management decision to say the least.
Two weeks ago, we wrote that the ongoing bear market test in uranium stock UEC. That was when the stock retraced to test the $1.25 level.
Right now, UEC is trading 20 percent higher. Seemingly, the important test at the $1.25 support level was successful.
The chart makes our point. As long as the price of UEC remains in AREA 2 (see annotation on the chart), it is in a semi-bullish area. Our interpretation is that a secular breakout outside the bear market channel is being prepared from within that area.
To rephrase what we are saying: as UEC trades between $1.25 and $2.10, it is in a good spot to go for a huge breakout and become the outperformer in the uranium mining space once uranium miners become bullish.
We can’t stress enough the importance of remaining focused on the sector as a whole. The most ideal way to follow the uranium sector is through URA ETF. One of our forecasts was that March 2017 would mark a fight between bulls and bears in uranium stocks. That forecast played out as anticipated, and the most important price level to watch remains $15 in URA, as explained in detail in uranium stocks: what happens at $15 has huge implications.