Weekly Review REE Stocks - 18th Oct 2024Here is the weekly...

Weekly Review REE Stocks - 18th Oct 2024

Here is the weekly review figures and charts that I do every week. It is useful only for those interested in trading or those who hold multiple shares and based on performance would like to keep re-balancing as we go. I do hold a number of REE stocks and like to trade. This is the reason I include a number of REE Stocks in my analysis. I also have history of 2023 for those interested in longer term view.

Please note:
This is no reflection of all AU REE stocks as I have only included those that I am interested. In my list are shares that I hold, held before or planning to buy in near future. Since this is my list, I may have missed some good stocks. The averages are simple averages and not weighted averages. So the average don't reflect AU REE average. This is just for my tracking and analysis.
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Please note that all my analysis are from a trading perspective looking at short-term view.
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This week no new additions, so my list contains 30 REE related stocks.
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How are we going in 2024 - General Market

• SP 500 still doing great. Making new highs all the time. I had been writing that there is a good chance we may see 6000. Its getting close. Did another all time high this week on 5878 and highest weekly finish ever at 5864. No stopping this bullet train. From a weekly perspective, gains just under 1%, last week at 5819, this week 5864.
• Volatility Index VIX is at 18.03, firmly in bull territory under 20.
• Sentiment Indicator still in Greed/Extreme Greed at 75, last week it was Greed at 74. So representing market sentiment correctly, above 75 is Extreme Greed, and when it reaches early 80s, usually we top and then market eases a bit, for those who like patterns
• Bitcoin after throwing some tantrums, now means business. At 68k and on track to do an all time high soon.
• Russell 2000 still not doing great. But this week did better than other indices, mainly also because it was lagging a lot. Still a better sign. We need it to outperform so that all risk-on assets do well, resources. commodities etc. It has been weakest indicator. This week did well and gained around 2% for the week. Finished at 2276, last week at 2234.
• Yields increased, again, even with rate cuts, a big jump this week, at 4.07 - something does not look right, indications are that caution may be required, and money wants to go to bonds, but same sign for several weeks now but stock market still going up. Follow the price.
• Dollar Index too going up like Yields
• Gold up, Silver up, Oil down - Gold at 2736, Silver at 33.92, Oil at 69.34
• So overall markets looking great, but couple of signs asking for caution. So same as 2 weeks back, I feel - "be watchful"

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What may happen next week - General Markets/U/Li/REE:

• SP 500 after doing a new all time high this week, would be eyeing 6000 figure. This is what I have been writing for quite sometime. We are getting close. Another week or 2 maybe - just before election? Also volatility may be high for 2 reasons - Middle East situation and US elections. But overall economy is doing all right, so lets see.
• Russell 2000 is still not doing the big jumps that is required. But catching up now. Not good for small caps. Not good for commodities, resources, risk-on stocks - tough times ahead. If it does not do better, it will be reflected in our Li/U/REE/Nickel/Copper/Iron Ore/Graphite etc stock prices. Only if see big gains in this index, rotation signs will happen
• Economic data next week - Nothing very important, usual job data etc
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• Uranium Sector overview - I have been writing for last few months months, May end top, July end bottom, September end top. My last thinking which I wrote was - "Will CCJ do a new high above 56.24 or do a back test of 45 - which one will happen first? I don't know". Now we know. CCJ did a new high of 58.64 this week. There was some chance of 45 test, I was waiting, but fundamentals too strong. Amazon wants to invest $500m in nuclear for their needs. That news stymied any thoughts of 45. Before that Microsoft and Google committed themselves. These are big tech companies that drive the stock market. The new AI revolution. They need power to fuel this journey. Clean power. Nuclear power. So indirectly these big companies are now going to drive the Uranium industry. The Uranium industry comparatively is much small, smaller than many of these big stocks. US market size is only $50b, rest of the world maybe another $50, so all up $100b (+/-) for the whole world is total nuclear industry. In comparison, Amazon 2 trillion. So if things go well, because of its small size, big increases can happen. The cost of Uranium fuel to a Nuclear Power plant is around 10%, so if Uranium price increases a lot, it will still be affordable. So lots of opportunities are there and price can increase a lot, making bigger profits for companies. But Spot price is sitting at 80s after reaching 106 in January. Its better than 40/50 2 years back, but needs to go higher. I feel in this run CCJ will reach between 65 to 70. Anytime it drops over 10% from its high, caution required. The sector has been played before. Just 2 months back, nearly all ASX U stocks dropped 50% from their high. They have not yet recovered to their high, even though CCJ has. So its volatile. I am now playing U sector, but there are no guarantees, so please check your risk/reward and dyor.
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• Lithium Sector overview - The sector has again gone into a confused state. In early September, most of the Li stocks all over the world made their new 52 week lows. Then a revival happened. Some fuelled by spot price increase, which was not much. But others by acquisitions. That changed the sentiment. Sometimes sentiment is much stronger than economics, in share markets. That sentiment and changed conditions gave rise to Li stock prices. Many rose more than 50% from their recent lows, some even up to 80%. There were some who gained only 30 to 40%, but it was still a gain. All was going smooth. Then previous week signs of confusion, jittery. This week it has continued to be same state. So the reversal that was happening has been stalled. A pause. It is not yet negated. Most stocks are still 30 to 40% from their lows, some have reached down to 20%. But a question mark has been raised. At this stage, I have no clue. I am no expert though. I feel, and again just a gut feel, is that we may hover over here for some more time. We may go slightly up or slightly down, but huge change may not happen immediately. Usually in uncertainties, stocks drift down slightly, so that could happen. I have nearly exited the sector, playing small now, 2 weeks back I was mostly playing Li sector, now have rotated to U sector. Although this is my thinking, I believe in following price action rather assuming and sitting on it. So things can change, sometimes quickly. I will also change when that happens. Till then I wait. This is my reading, but please dyor as I could and have been wrong before. ALB has to get over 106 and Ganfeng 36/37 level, for good confidence.
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• REE Sector overview - REE sector too doing consolidation this week, mirroring Li sector play. But overall its a bit tentative, on the weaker side for now

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Personally:
Last week I was away, so just had the numbers , no commentary. 2 weeks back when I wrote, I had 11 Li stocks. Now I only have 3, that too with reduced holding - AZL/INR/SYA. I am waiting for macro to give some good signals.

This week I have moved into Uranium sector. Stocks that I am playing are - AEE/AGE/BMN/BOE/CXU/DYL/EL8/LOT/PDN/PEN/SLX. I have more on big stocks and less on mid and small stocks. This is based on my reading of last several months that initially the big stocks make most initial gains. But that could change. The mid and small stocks have had a rough time, they may come back with a vengeance. I am waiting.

Other plays - Main health stocks - DXB (26)/BOT (17)/PYC (7.5), Gold - PNR (5.2). I was writing I was looking at MEI/ENR for last few week, MEI (avg 10) and ENR at (avg 37) - reduced average for both, small though, some buy/sell. Bought 2 more health stocks which I will write next week.
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Stock/Sector specific Info:

• This week ENR had a consolidation play in mid 40s. Volume usual. Overall its playing weak. Back to old play in 20s/30s. who would have known that we had reached 90s shortly back?
• From a weekly perspective, remained flat at 36. No real direction for now
• 2 weeks back I had written I had ENR at 41. Earlier I had sold at early 80s as I wrote before, my buy average was 30.5, so that was a good win, in fact, a very good win . that was really lucky, in hindsight. I had also written taht I want 40 to hold. Its not holding. I was in 2 minds - exit or hold? . I decided to now play to reduce average till its above 30. So everyday, based on trading patttern, I put some buy at lower number and sell at some higher number, which I feel it may go. It does not happen every day, but I have had 4 trades like that in 2 weeks. I have reduced my average to 37 from 41. I will continue to do this play and reduce my average till we see a decisive move in either direction.I will be ahppy to get my average to 30.5, like last time.
• REE stocks that I track lost 3% for the week, so a weak time
• REE stocks down 7% for the year,
• General markets looking very good, so no fear from there I feel. Li sector considerable improvement, so lets hope some good times to come

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Here is the Figures for the Week:
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