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“Human nature is your greatest enemy at market lows. At your absolute climax of fear, you must do the exact opposite of what you want to do.”
– Charlie Munger
“Be fearful when others are greedy and greedy when others are fearful!”
– Warren Buffett
Uranium stocks are deeply oversold, and history shows that rallies follow. Our new Dynamic Timing Model helps you buy at the right time, lock in gains, and minimize risk. Over the last two years, the sector has only been at this level of oversold three times. The rallies that followed these sentiment/RSI lows resulted in increases (for URNM) of +45% (over 4 months), +33% (over 2 months), and +75% (over 7 months). This sector can turn on a dime, and the sentiment/RSI we’re seeing right now should be interpreted as an excellent entry point to maximize gains. Our Dynamic Timing Model can aid your trading decisions.
We have added this new model to our service – not because we aren’t more convinced than ever in our research that the uranium price will have to go far higher than present levels to incentivize the necessary increases in future uranium production to satisfy the quickly growing demand – but because but we are equally aware that the outsized volatility has taken a toll on many sector investors. This model aims to make this volatility work FOR you, not against you.
With the introduction of the Dynamic Model, we just added the below four securities in equal dollar amounts. Because of the liquidity constraints for many individual names in the uranium equity universe, for the Dynamic Model, our investment components will only employ the most liquid uranium equity names in the sector for swinging from an invested to an uninvested position. For the reasons why ………..and how we will administer this program, continue reading.
Dynamic Model: 100% Invested, 25% Allocation to Each Name Below:
(Sector State: Extremely Oversold)
Cameco Denison NexGen Uranium Energy Corp.
CCJ DNN NXE UEC
The uranium market has transformed in ways no one predicted, making this one of the most exciting investment opportunities in decades.
What we initially thought would be a 3-5 year cyclical bull market we now believe is going to be a much longer-term secular bull market because of all of the developments that have occurred over the last several years, including:
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accelerated new builds
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plant life extensions
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reactor uprates
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AI & data centers electricity demand
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the world’s embrace of nuclear power (e.g. The COP28 commitment to tripling nuclear power by 2050)
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the emergence of India’s aggressive nuclear buildout plans following in the footsteps of China
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the new Trump administration’s laser focus on expanding the U.S. energy grid, and
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the likely impact on uranium of future SMR demand (something that was barely on the radar screen in 2019 when we started).
We are firmly convinced that all of these factors will contribute to a multi-year sustained uranium bull market potentially beyond this decade due to the imperative to create new production to satisfy the quickly growing demand.
How is the “Dynamic Model” Different from our Focus List?
The uranium equity market essentially resides in five states: severely oversold, oversold, fairly valued, overbought and severely overbought. The way the “Dynamic Model” is going to operate is that we are going to provide three different “signals”– in other words, three different exposure levels: 100% invested, 50% invested, or 100% in cash.
Each week in our Sunday Watchlist, we've helped members navigate uranium's wild swings, identifying when to take profits and when to buy into oversold conditions. We are now formalizing those views into discrete trading signals. We intend to transmit these signals to you on an “as needed” and timely basis via UI email Bulletins. We will also include the “overbought or oversold” state that we perceive the sector is in each day in our Daily Market Data Sheet that all Members receive every day.
During points in time when the market is deeply oversold – like the present condition we’re currently experiencing – we will be 100% invested in the four uranium equity positions cited on a non-leveraged basis. Conversely, when we move into overbought situations, we intend to reduce the size of the portfolio in increments by 50% until such a point in time that we perceive the sector to be severely overbought – at which time the “Dynamic Model” will signal a move 100% to cash. Subsequent ingress or egress signals will be dictated by the sector becoming either oversold or overbought once again.
Why have we elected to Take this Action Now?
In the past, we have been reluctant to adopt this type of approach for two main reasons: 1) we were concerned about the negative tax implications of short-term trading, and 2) we did not foresee that the market would sawtooth in the fashion that it has over the last few years. We are convinced, however, that volatility is here to stay and perhaps even become more elevated…notwithstanding that we strongly believe the long-term bias will continue to be upward, as evidenced by the upward movement of the long-term uranium price. Accordingly, we are introducing this alternative way to participate in the space to create greater gains as well as greater peace of mind by wringing out some of the sector volatility for Uranium Insider members.
Summary:
What we once thought would be a cyclical bull market we now believe will be a much longer-term secular bull market because of the accumulation of factors that have dramatically increased our future uranium demand estimates vs. our estimates of as recently as 2-3 years ago.
We’ve never been more confident in uranium’s upside potential. Prices must go higher to meet surging demand. That is not to say that we do not share the frustrations of many investors in the sector who have been disappointed in the performance of uranium equities since November 2021 given the dramatic strengthening of the long-term case for uranium over the last several years.
We will be running both our Focus List and Dynamic Model program and will be documenting the performance of both programs on a monthly “mark-to-mark” basis in each monthly newsletter. Our Dynamic Model will use the worst possible selling prices on the day that sales are called for and the worst possible buy prices on days the Dynamic Model calls for buying.
This new Dynamic (Timing) Model will aim to take advantage of the frequent sector volatility and will result in more peace of mind and trading confidence by providing you with clear signals allowing you to take advantage of the sector volatility.
Every time Investor Sentiment has Reached Current Levels a Significant Sector Rally has Followed:
Despite the steadily improving fundamentals, investment sentiment towards the uranium sector has reached levels that have only occurred 3 times over the last 5 years. Each time sentiment plummeted to present levels a very material sector rally ensued. With the new Dynamic (Timing) Model, we intend to capture rallies and then move to cash in increments to lock down gains and reduce volatility.
We don’t want you to miss this opportunity…
Special Membership Discount:
Because we want you to take advantage of this moment, we’re offering a limited-time discount on membership:
Quarterly Membership: $197/quarter (Save $50...Reg. $247)
Annual Membership: $497/year (Save $300...Reg. $797) → Best Value!
This offer expires at the end of February (in 3 days!), and with the uranium market at historic lows, this could be your best chance to position yourself for the next rally.
Sincerely,
Justin Huhn
Founder and Publisher
Uranium Insider – Independent Research |
