SIACharts Logo

Commentary >

Cameco Corp. - (CCO.TO) - April 3, 2024

SIA Charts’ relative strength rankings help investors identify opportunities in stocks which are outperforming their peers or index benchmarks on a relative basis. Outperformance often reflects improving investor expectations for strong company or sectors growth.

The price of Uranium has increasingly been bouncing back from a February correction with a gain of 11.0% in the last month, including a rise of 6.7% in the last week. Boosted by a price resurgence, Uranium producing stocks have also been recovering from a winter correction and moving back up in relative strength rankings.

Yesterday, by jumping 24 spots to 13th position, Cameco Corp. (CCO.TO) has climbed up out of the red zone and returned to the Green Favored Zone of the SIA S&P/TSX 60 Index Report for the first time in about six weeks, confirming renewed interest in both the stock and the sector. During its previous 9-month run in the Green Favored Zone from May 2023 to February 2024, Cameco gained 46.5% while the S&P/TSX Composite rose 5.3% over the same period. Since the middle of March, it has become increasingly apparent that a winter correction in Cameco Corp. (CCO.TO) shares has run its course and accumulation has resumed. Last month, the shares found support at a higher low near $53.00, keeping their underlying uptrend intact. Shortly afterward, CCO.TO rallied up off of $53.00 on a volume spike, a sign of renewed interest. On Monday, the shares staged a breakaway gap to the upside over $40.00 and yesterday in a follow through rally, the shares closed above $63.00, calling off a potential bearish head and shoulders top pattern that had been forming.

A close above initial resistance at the January highs near $68.00 would confirm the start of a new upleg. Should that occur, measured moves suggest potential resistance on trend near $71.00, $79.00 and $83.00. Initial support moves up to the $60.00 round number and breakout point from $56.00.

Last month, a correction in Cameco (CCO.TO) shares bottomed out in a bullish Bear Trap where they broke down by one row, flushing out stops and then turned back upward. In doing so, CCO.TO established a higher low, keeping its longer term uptrend intact.

Since then, the shares have been recovering lost ground and building on a bullish Double Top breakout. Initial upside resistance may appear at the January peak near $69.85, followed by $77.10 based on a horizontal count. Initial support appears near $59.60 based on a 3-box reversal.

With its bullish SMAX score (which is a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) increasing to 6 out of 10, CCO.TO is exhibiting short-term strength against the asset classes.

Disclaimer: SIACharts Inc. specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investors investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.

Related Posts

Keep up to date on the latest financial market news.

Receive a daily newsletter with stock highlights, ETF rankings, weekly market focus and others.