The high volume breakout in the uranium sector may have occurred this past Friday when the uranium mining ETF soared over 6% on more than five times average volume.Keep a close eye on the junior uranium miners which could see incredible growth over the long term. We may be witnessing a short term uranium glut from the shutdown reactors in Germany and Japan, but over the longer term we will enter a supply deficit as there are more reactors being built now than from before the Japanese Nuclear Accident in March of 2011. As 2013 ends, so does the Russian uranium supply agreement which provided around 25 million pounds of yellowcake to the U.S. annually. In addition to uranium, don't forget gold. It is important to remember that some junior gold miners are so undervalued with minuscule market caps that are only fractions of what they spent on advancing the project. This junior gold miner with a resource of over 20 million ounces of gold sports a market cap of less than $50 million and has invested over $250 million advancing this project through feasibility.Read more
Rare Opportunity In This Heavy Rare Earth Miner Making a High Volume Bullish Move
No doubt over the long term commodities is the place to be as the world continues to develop and modernize. Demand for traditional commodities such as copper, oil and iron ore will continue to grow. However, strategic metals that are controlled by the Chinese such as rare earths, graphite, and tungsten could soar exponentially over the nearer term as supply shortfalls are quite risky in the near term. Although these metals are not traded like precious metals, copper and oil their role is vital for the new technologically driven global economy. Everything from wind turbines to smart phones use these strategic metals. Apple, Ford, GM, GE, Vestas and First Solar require these metals to produce their high end products. We all use these critical metals daily, yet many of us have little to no investment exposure for these vital materials. End users such as the companies mentioned above may look to invest in the junior miners to diversify away from China which uses its dominance of this sector as a negotiating tool.Read more
Is U.S. Dollar Decline Going To Spike Gold and Silver Prices?
Be prepared for a "V" shape reversal in gold, silver and the junior miners which have been basing for close to three years and are very oversold. Investors may be a little early in claiming good times are here again. The global economy and debt situation remains challenging. Gold and silver appear to have found support and may be on the verge of a major reversal higher. Look for a reversal above $1300 to break the recent seven week consolidation. I like silver even more than gold as demand is increasing for this white metal as an alternative to fiat currency and for its rising industrial applications. A breakout could occur past $22. Silver is in a three month uptrend which has stayed intact.Read more
Take Profits In These High Flying Sectors and Consider The Historically Undervalued Miners
U.S. stocks are rallying on hopes on some sort of deal coming out of Washington. Just like we have witnessed over the past several years, lawmakers will come to some sort of last minute deal to kick the debt can down the road. Over the next week look for some sort of move to avert a default. The markets could rally short term on such a deal, but over the longer term the equity and housing markets appear to be ready for a major correction after rallying for two years. We are witnessing bubbles in certain areas of the market which I encourage investors to steer clear from especially banks, housing, social media and biotech as these are very crowded trades filled with promoters, snake oil salesman, charlatans and day traders. Overbought bubbles end up in devastating losses. Stay away from these high flying sectors and instead focus on the historic discounts in the mining sector.Read more
Will The Uranium Price Make a Fourth Quarter Comeback?
For many months I reminded my readers to ignore the low uranium spot price and the hysteria in the media over nuclear power. Instead I encourage all investors to focus on the increased M&A in the uranium mining sector where junior miners who are extremely early stage and do not even have a NI43-101 resource are being bought out for $185 million. Despite the uranium spot price hitting generational lows, we are witnessing ongoing consolidation and increased M&A in the uranium mining sector. This may mean the smart money is anticipating a major rebound in demand and prices. If we are seeing this much M&A activity in the uranium mining sector when the spot price is hitting eight year lows, imagine what could happen in this small sector when uranium starts moving higher.Read more