ChartWatch: Where’s the bull market in ASX uranium stocks now?

I’ve fielded many requests via X (formerly Twitter) for today’s ChartWatch, and given the recent pullback in the prices of many ASX uranium stocks, it’s perhaps a little overdue. As we will see, the charts suggest many Aussie uranium stocks are at a critical juncture in terms of their short and long term trends.

I will cover the top 10 ASX uranium stocks by market capitalisation, in order, but let’s kick off with a check up on the uranium futures price.

Uranium Futures COMEX (back-adjusted chart)

Note the price action change on the uranium futures chart. Source: TradingView

ST/LT Trends: ⬇️ / ⬆️

Price action: 📉

Candles: n/a

Key Support / Resistance: LT uptrend ribbon @ 77.50-85.00 / 29 Jan trough low @ 100.40

Commentary: In my last update on ASX uranium stocks, I noted the occurrence of a lower peak to 107.20, and therefore the importance of the price continuing to close above the 100.40 trough (note, due to the systematic back-adjusting of futures contract prices these values were different, but the price action in the chart is consistent).

As it turns out, the close below 100.40 was decisive in precipitating further supply which has swung the short term trend to down. I suggest a close above 100.40 is required to re-establish the short term uptrend, or at the very least, a return to higher peaks and higher troughs in the meantime.

Due to the fluid nature of the July-Jan rally, there are few points of historical excess supply which could act as future points of excess demand. Therefore, the long term uptrend ribbon is the key area of (dynamic) demand going forward. As long as the price continues to close above this ribbon the long term uptrend is intact.

Nexgen Energy (ASX: NXG)

Super interesting battle between demand and supply here

ST/LT Trends: ⬆️ / ⬆️

Price action: ⬅️➡️

Candles: ⬜⬛

Key Support / Resistance: 26 Feb trough low @ 10.25 / 8 Mar peak high @ 12.48

Commentary: Today’s bearish long black candle confirms a classical head and shoulders pattern. It’s still a live candle, so I will be careful drawing absolute conclusions just yet but should NXG close near the low of the session, it would be a resounding display of a return to supply-side control.

I suggest a close back above 12.48 is required to demonstrate supply-side control has been relinquished, and while the price continues to close below 11.70, a move to the next clear level of historical demand at 10.25 is a distinct possibility.

The long term uptrend ribbon is also a key area of potential dynamic support. It will also likely kick in around the 10.25 area.

Paladin Energy (ASX: PDN)

Plenty of white candles demonstrates PDN is relatively popular among its ASX uranium peers

ST/LT Trends:  ➡️ / ⬆️

Price action: ⬅️➡️

Candles: ⬜

Key Support / Resistance: 5 Mar trough low @ 1.185 / 8 Mar peak high @ 1.27

Commentary: A most severe correction from the 1.46 major peak. The response from the demand side has been solid, though, with many white candles and by Friday a return to higher peaks. Friday’s close was not convincing, and today’s move confirms the 1.26-1.27 area as a key zone of excess supply.

I suggest until the PDN price closes above 1.27 the demand-side is yet to emphatically seize control. If that occurs, there’s every chance that PDN could have another look at 1.46. If, on the other hand, the PDN price closes below historical support at 1.185, another look at 1.10 is possible.

I note whilst the short term trend is undecided, the long term uptrend is intact, and the long term uptrend ribbon should provide dynamic support.

In conclusion, I note that plenty of white candles clearly demonstrates PDN is relatively popular with investors compared to its ASX uranium peers.

Boss Energy (ASX: BOE)

Boss’s chart is similar to PDN’s, but vitally, is lacking the all-important showing of demand-side candles

ST/LT Trends: ⬇️ / ⬆️

Price action: ⬅️➡️

Candles: ⬛

Key Support / Resistance: 26 Feb trough low @ 4.40 / 4 Mar peak high @ 5.06

Commentary: Similar to PDN, but I would argue the rally since the 26 Feb low of 4.40 has not been anywhere near as impressive. Also of concern, I note the prevalence of supply-side candles, particularly at the peaks of 5.06 and 4.99.

It sets this area and up to the 29 Jan trough low of 5.16 as a key area of excess supply going forward. A close above 5.16 is required to confirm the demand-side has regained control, but in its absence, the likelihood is the supply-side remains dominant in the short term.

The long term uptrend is intact, but on a close below 4.40 it would be under severe pressure.

In conclusion, the technicals suggest BOE is the less preferred option compared to PDN among the investment community.

Silex Systems (ASX: SLX)

Another chart with potentially diverging short and long term supply-demand dynamics

ST/LT Trends: ⬆️ / ⬆️

Price action: ⬅️➡️

Candles: ⬜⬛

Key Support / Resistance: 26 Feb trough low @ 4.46 / 1 Mar peak high @ 5.12

Commentary: Perhaps somewhere between PDN and BOE? The demand-side still has short term control over the SLX price, but their control over medium term prices is debatable. A close above 5.12 would confirm the demand-side is once again superior, and also increase the possibility of a retest of 5.78.

On the other hand, a close below 4.71 suggests the supply-side is back in control, and only 4.46 then stands in the way of a test of the dynamic support expected at the long term uptrend ribbon.

In the meantime, the short term trend in terms of both price action and the trend ribbon is largely neutral.

Deep Yellow (ASX: DYL)

The long term uptrend ribbon stands as the final zone of support for DYL

ST/LT Trends: ⬇️ / ⬆️

Price action: 📉

Candles: ⬛

Key Support / Resistance: 27 Dec peak high @ 1.18 / 4 Mar peak high @ 1.365

Commentary: The supply side is in complete control of the short term price action here. The long term trend is intact, but looks like it will come under some pressure soon.

1.18 to 1.235 is now the key area of historical excess demand. A close below this zone may make the dynamic support usually expected from the long term uptrend ribbon a moot point.

A close above 1.365 is a minimum to demonstrate the demand-side has regained control.

Lotus Resources (ASX: LOT)

The strongest showing by the demand-side out of any Top 10 ASX uranium stock

ST/LT Trends: ⬆️ / ⬆️

Price action: 📈

Candles: ⬜

Key Support / Resistance: 2 Feb peak high @ 0.38 & 6 Mar trough low @ 0.345 / 8 Mar peak high @ 0.40

Commentary: Clearly the best short and long term trends in the Top 10 ASX uranium stocks cohort. Good price action and predominantly white candles confirm nearly unopposed demand-side control.

Has a history of being a bit choppy though, typical of a company that has a massive float. But there’s very little here to suggest the prevailing uptrends are under much pressure.

Bannerman Energy (ASX: BMN)

The long term uptrend ribbon appears to be holding for now

ST/LT Trends: ⬇️ / ⬆️

Price action: ⬅️➡️

Candles: ⬜⬛

Key Support / Resistance: 26 Feb tough low @ 2.88 / 8 Mar peak high @ 3.39

Commentary: A similar correction from the 3.99 major peak to most of its peers. The long term uptrend ribbon appears to be doing its job of providing dynamic support well.

I note plenty of demand side candles since the major trough at 2.88 (but nowhere near as convincing as PDN’s).

Today’s dip, which forms Friday’s high of 3.39 as a peak, is disappointing, though. It sets 3.26-3.39 as a key major zone of excess supply which must be overcome to confirm a return to demand-side control.

A close above 3.39 would likely facilitate a look at 3.99, whereas a close below 2.88 would demonstrate supply-side control and substantially threaten the long term uptrend.

Peninsula Energy (ASX: PEN)

Hardly anything to cheer for PEN bulls

ST/LT Trends: ⬇️ / ⬇️

Price action: 📉

Candles: ⬛⬜

Key Support / Resistance: 21 Feb trough low @ 0.105 / 2 Feb peak high @ 0.145

Commentary: The supply-side looks like they’re well in control here. Short and long term downtrend ribbons, lower peaks and troughs, and uninspiring candles prevail.

Likely nothing to see here until the demand side can confirm they’re regained control by forcing a close above 0.145.

Alligator Energy (ASX: AGE)

There are major issues with AGE’s short term trend

ST/LT Trends: ⬇️ / ➡️

Price action: 📉

Candles: ⬛

Key Support / Resistance: 6 Mar trough low @ 0.053 / 28 Feb peak high @ 0.062

Commentary: The supply-side appears to have complete control over short term price action. That control appears to be extending to long term price action also, with the long term trend ribbon now flashing neutral. If the price closes below 0.053 it would confirm the supply-side has total control.

A close above at least 0.062 is required to demonstrate the demand-side is back in control, or in the meantime, a return to higher peaks and higher troughs (or demand-side candles of any sort!).

Elevate Uranium (ASX: EL8)

EL8’s long term uptrend is under significant pressure

ST/LT Trends: ⬇️ / ⬆️

Price action: 📉

Candles: ⬛

Key Support / Resistance: 26 Feb trough low @ 0.44 / 4 Mar peak high @ 0.52

Commentary: Another stock with a far from convincing technical picture, and a reminder that not a syllable of the analysis in this article considers the fundamental picture or outlook for any of these companies.

Charts are simply a schedule of demand and supply, and when read correctly, don’t seek to predict (because the future is unknown) but merely react to signals of either excess demand or excess supply.

As with many of the ASX uranium stocks here, the EL8 chart demonstrates near-total control by the supply side in the short term. But whilst many of its peers demonstrate a continued strong long term uptrend, EL8’s long term uptrend looks under severe pressure.

A close below 0.44 would terminate the long term uptrend, while at least a close above 0.52 is required to confirm the demand-side has returned to control.

Carl’s Technical Analysis Methodology Key

Trends (ST Trend ribbon: 21 & 34 EMAs || LT Trend ribbon: 144 & 233 EMAs)

⬆️ = Uptrend, the ribbon is rising indicating a higher probability the market is in a general state of excess demand

⬇️= Downtrend, the ribbon is declining indicating a higher probability the market is in a general state of excess supply

➡️ = No trend, the ribbon is flattening indicating a higher probability the market is in equilibrium

Price Action

📈 = Rising peaks and rising troughs indicating buy-the-dip activity and supply removal (i.e., indicating a higher probability market is in a general state of excess demand)

📉 = Falling peaks and falling troughs indicating sell the rally activity and demand removal (i.e., indicating a higher probability market is in a general state of excess supply)

⬅️➡️ = Neither of the above scenarios, market price action is indecisive

Candles

⬜ = Predominantly demand-side candles in the recent past, i.e., white bodies and or downward-pointing shadows (i.e., indicating a higher probability market is in a general state of excess demand)

⬛ = Predominantly supply-side candles in the recent past, i.e., black bodies and or upward-pointing shadows (i.e., indicating a higher probability market is in a general state of excess supply)

⬜⬛ = Mixed, i.e., indicating no discernible trend towards demand-side or supply-side candles in the recent past