Time to buy?

That was the question with which I looked at a couple of charts. All the charts (of the uranium explorers/miners) look similar. Yet I find the ones from MGA.TO and LAM.TO the most illustrative. What I see is a down move on increasing volume, a bottom and then decreasing volume. Ever since the top volume (at the bottom) volume seems to be falling.

This suggests that the bottom was due to a sellers exhaustion.

But buyers have not yet stepped up to the plate, as would have been evidenced by rising volume after the bottom.

Hence the sector remains susceptible to downside if the overall market would do so.

A double bottom would thus be my favorite, low-risk entry, to add to my positions.

The second favorite is a long drawn out bottom on very low volume.

In any case, as long as volume does not increase, there is IMO no real low risk entry point.

I do think that based on fundamentals the uranium exploration/mining sector is a screaming buy right now. However for a real low risk entry we need to wait.

If you are not yet in this sector, but want to, then my suggestion would be to nibble a bit right now, but keep 50% of the money available for the volume signal.

You're probably right, although I already used the rest of my powder.

Suddenly all kinds of negative signals are intruding the market. The economies of Italy, Germany and Japan are slowing down notably, US consumer confidence is declining fast, East European countries and Russia experience serious stress in the labor sector and this already results in price inflation (CPI, PPI,...), ...

I doubt no more that this liquidity squeeze will translate itself in a credit crunch and consequently some kind of investors will be obliged to exit some or all positions.

Maybe the next stage is the unwinding of the Swiss Franc carry trade and problems in the East European credit markets (Latvia's government bonds downgraded, 60 % of all emerging market credit went to the East European countries, in Hungary 80 % of all mortgage loans have been in Swiss Franc (via Austrian banks), ...). Then where to hide?

http://danskeresearch.danskebank.com/link/EmUpdateWhatToPlay160807/$file/EmUpdateWhatToPlay160807.pdf

It'll be tough to pinpoint a real low risk entry (of course it depends what you understand by a low risk entry).

veg (looking for the safe havens).