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Cameco Corp. - May 8, 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 sector growth. Uranium producer Cameco Corp. (CCO.TO) has been a relative outperformer among Canadian large caps, spending most of the last year in the Green Favored Zone of the SIA S&P/TSX 60 Index Report. In the winter, however, the shares dipped down into the red zone briefly as the shares staged a correction. About a month ago, CCO.TO returned to the Green Favored Zone and it has remained there since, finishing yesterday in 5th place. Since returning to the Green Favored Zone, CCO.TO is up 9.7% compared with a 3.8% return for the S&P/TSX Composite Index. The previous time Cameco was in the Green Favored Zone, from May 2023 to February 2024, it returned 46.8%, compared with 5.3% for the index over the same period. Three months of consolidation in Cameco Corp. (CCO.TO) shares ended yesterday as a breakaway gap up to a new all-time high put an exclamation point on six weeks of steady recovery. Yesterday’s breakout confirmed that Cameco’s long-term underlying uptrend has resumed and also completed a bullish Ascending Triangle pattern. The only other thing that would have been nice to see would have been a volume spike like the one in March when the current advance kicked off, but it’s not necessary since we had the earlier one. A measured move from the recent trading range suggests next potential resistance on trend may appear near $85.00. Initial support appears at the February low near $62.75.

Cameco Corp.’s (CCO.TO) breakout to a new all-time high, indicates that the winter correction has ended and its long-term uptrend has resumed. A downswing in the shares bottomed out in March and in recent weeks they have been under renewed accumulation, bouncing back then pausing briefly. Yesterday, the shares broke out over $68.50, completing a bullish Spread Triple Top pattern and a Bullish Catapult, signaling the start of a new advance. Horizontal and vertical counts suggest potential upside resistance tests on trend may appear near $77.10, $88.60, or $92.15. Initial support appears near $64.50 based on a 3-box reversal.

With a bullish SMAX score (which is a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) of 7 out of 10, CCO.TO is exhibiting short-term strength against the asset classes.

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