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Uranium Stocks Still Weak
Thursday, April 28, 2011
by Paul Thornton of Investor Boot Camp Online
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Uranium stocks were nuked following the news of serious damage to a Japanese nuclear reactor. The idea of bottom fishing for a deal is understandable given the huge gains in the sector prior to their correction.
But like any other trade, timing is everything! The issue with buying into a stock following a huge percentage price decline is the sudden creation of resistance. For traders who are still in the stock they want out as recovery attempts kick in. Except for shorter term traders, it deters investors who might otherwise have been buyers. They see the damage, assume the risk is too high, and decide to postpone a buy. 
What may have been overlooked by traders thinking of "bottom fishing" is that most stocks from this sector were already in a correction that shaved as much as 50% of some of the big winners. In every correction there are two elements in the price trend; - The percentage decline from the high to the low and,
- Time.
Even if the stock bottoms out after one day there is a process of wearing investors out over time as attempts to profit, or sell at higher prices, is either exhausted or doesn't work. If you had to pick what works better, bounces typically work in the favor of sellers rather than buyers. Day traders may take a run at this scenario but other traders typically fail in attempts to profit. 
Patience has been the bottom fisher's best strategy. Some uranium stocks continue to form the bottom of their bases but others are still testing new lows. That implies they still need to trade in a range that defines the bottom of the base. Once an attempted recovery kicks in, the right hand side of the base, traders may execute a buy that should be much more reliable. If momentum develops, it could be a profitable trade. Imagine the money that could be made in a full recovery to the highs, followed by a break out to new highs and a renewed up trend. Investor Boot Camp Online, www.investorbootcamponline.com, is the premier source for buys and sells with precise timing. Investment webinars are scheduled every Tuesday at 1:00 p.m. e.s.t. 
Recent articles from this author
- Stock Market Consolidating - Friday, April 13, 2012
- Reading the condition of the stock market - Monday, June 20, 2011
- Pump Up The Profit - Wednesday, May 11, 2011
- Break Outs Are Key Indicator - Monday, May 09, 2011
- Silver Hammered - Monday, May 02, 2011
About the author
Paul Thornton
Investor Boot Camp Online
Trading and money management experience: 24 years Paul Thornton is the Director and Chief Research Strategist with Investor Boot Camp Online. Paul is an expert in market timing and trade execution strategies. He is frequently on national television and other media for his market insights and investment strategies. He is the author of Boot Camp Banter with commentary on markets, the economy and business that is rarely heard. He is also the creator of Baseball and Investing which is an ongoing series comparing baseball to the management of investments and portfolios. He is well known and respected as a leader in investor education. Classrom seminars include Investor Boot Camp, Influences in the Stock Market, Understanding Investor Behaviours, Bases, Fixed Income Investing and the Advanced Investor Workshop are popular investment seminars. Investor Boot Camp Online is the premier independent online investment information service. The extensive information is used by investors who manage their own portfolios, investment advisors and fund managers. Trend changes are identified before anyone else and the top performing markets and stocks are identified at the beginning of up trends. Protecting capital in corrections has separated Paul from many other investment market experts. Research and strategies cover all North American equities, bonds, E.T.F.’s, commodities, income trusts and currency markets. The Investor Tool Kit is one of the largest investment resources available with information for both the novice and sophisticated investor. Mindset management is provided to help investors "keep their head on straight". Tips on Investing in Financings and Junior Resource Stocks are popular series with critical insights. Don't be fooled by the name Boot Camp. Experienced and disciplined investors may be the biggest beneificaries of trade indications and trade templates. Paul created the "Trade Risk" indicator which is a measure of the reliability of transacting in the stock market. His passion is to find the next great trade, as well as convince investors to sell at the beginning of corrections and keep them out until it’s over.
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