Uranium price pondering’s

I think that the price of Uranium is currently in a blow-off top.

From today’s price of $52.70, it reaching $61-$64 is plausible.

However, assigning probability to an additional surge is difficult.

In other words, I’m not considering initiating a new long trade in Uranium futures.

It’s current price which is parabolic in shape, is also stratospheric by many measures.

It is Overbought on a weekly basis and on a monthly timeframe. The latter seldom occurs.

Furthermore, Uranium is trading at a stretched percentage (95%) above its 200 week moving average.

Commodity prices start entering rarified air whenever they venture 40% above this measure.

My trend analysis confirms Uranium’s bullish direction and it is garnering some strength. 

This suggests that momentum will send prices higher before it peaks.

To be clear, current ‘longs’ in uranium will get to have a little more of their (yellow) cake, but it is a riskier proposition for those thinking about initiating new positions at $53.

I think the price of uranium is prone for some mean reversion back to the $34 – $38 mark, perhaps occurring into January 2023.

October 24, 2022

by Rob Zdravevski

rob@karriasset.com.au