Not much has changed in the uranium market since last week’s Uranium sector roundup. In that article, I outlined the possibility that uranium could test lower limits of a range it has held in 2022.
Currently, uranium has broken down below interim support at $48.60. A retest of the broken down support (now turned resistance) has occurred and prices are likely to drift lower unless bulls can push prices back above $48.60. This means a move down to the lower limit of the 2022 range at $46.65 is still intact.
Barring some major fundamental news (likely to do with Russia and the European Union imposing sanctions on Russian uranium), spot uranium drifting lower will see uranium stocks either fall or just flat out range.
For long term bulls, this provides a great time to pick up uranium stocks on the cheap or as they are basing in their range preparing for the next leg up.
Here is what happened with the Athabasca based miners this week:
Fortune Bay (FOR.V)
Last week, Fortune Bay announced analytical results from the 2022 maiden drilling program on the 100% owned Strike Uranium Project located in northern Saskatchewan. This week, the company confirmed near surface uranium mineralization in multiple drill holes on the Murmac Uranium Project.
The drilling program was designed to test regional targets across the Project’s extensive Armbruster, Howland and Pitchvein Conductor Corridors, which have a combined strike length of approximately 30 kilometres. Shallow, highly elevated concentrations of uranium were confirmed in six (6) of the fifteen (15) drill holes, including 0.18% U3O8 and 0.17% U3O8 from individual assay samples.
The uranium levels found are typically associated with high-grade basement hosted deposits in the Athabasca Basin. Some very exciting discovery news, and if Fortune hits something big, I don’t need to tell you what could happen with the stock.
Dale Verran, CEO for Fortune Bay, commented “We are pleased to have intersected uranium in our first drilling campaign at Murmac. The results indicate we are exploring fertile corridors for high-grade uranium deposits and provide some immediate areas for priority follow-up. The shallow nature of the uranium encountered, and proximity to infrastructure within a historical uranium mining area, makes for a compelling exploration scenario. Planning is underway for a drilling program in 2023 to provide follow-up of these results and continued testing of the corridors on the Project.”
We talked about the stock in recent weeks. We have the major breakout confirmed with a close over $0.32 and this means the uptrend is still intact. The breakout zone support still holds strong at $0.32, and $0.40 needs to be taken out for continuation.
Fission 3.0 (FUU.V)
Fission 3.0 is a uranium stock that has been on fire due to their news of a discovery. This week, the company announced the results of the second and third follow up holes (PLN22-039 and PLN22-040 respectively), as well as an additional fourth follow up hole (PLN22-041) to the new high-grade discovery hole PLN22-035 at the A1 Conductor. Two of the three holes intersected significant radioactivity.
Drilling Highlights from follow up holes PLN22-039, PLN22-040 and PLN22-041:
PLN22-040 was a 23 m step out targeting along strike and grid south from discovery hole PLN22-035 and intersected the radioactive structure over 11.5 m between 260.0 m and 278.0 m.
- 8.5 m total composite mineralization >300 cps (between 260.0 m to 268.5 m), including2.5 m of total composite mineralization >10,000 cps over a 3.0 m interval (between 261.0 m and 264.5 m) with a peak of 63,400 cps at 262.5 m
- 1.0 m >300 cps (between 272.0 to 273.0) and 2.0 m >300 cps (between 276.0 m to 278.0 m)
PLN22-041 intersected the radioactive structure up-dip from PLN22-038 at a vertical depth of 200m.
- 12.0 m continuous mineralization >300 cps (between 198.5 m to 210.5 m), including 1.85 m of total composite mineralization >10,000 cps over a 5.25 m interval (between 204.5 to 209.75 m) with a peak of 18,800 cps at 208.5 m
PLN22-039 was planned to target on section and 15 m down-dip from the discovery hole PLN22-035. Unfortunately, due to significant drill hole deviation the hole steepened excessively, and the target was missed. A structure was intersected 42m down dip from 274.5 m to 283.0 m. No anomalous radioactivity was recorded.
The stock remains in a bullish trend although a pullback could be in play. Traders are likely taking profits and volume tends to dry up in December. We have closed below the key zone of $0.285, and a deeper pullback could take us to $0.185 before forming a higher low swing. As long as the stock remains above $0.13, the uptrend will remain intact.
Denison Mines (DML.TO)
Denison announced the successful completion of the neutralization phase of the Phoenix in-situ recovery feasibility field test at the company’s 95% owned Wheeler River Project. The neutralization phase was initiated in mid-October 2022, following the highly successful completion of the leaching phase of the FFT (see news releases dated October 17, 2022 and November 22, 2022), and was designed to confirm certain environmental assessment assumptions and verify the efficiency and effectiveness of the neutralization process planned for ISR mining at Phoenix.
David Cates, Denison’s President & CEO, commented, “The completion of the neutralization phase of the FFT marks the end of our 2022 evaluation field activities at Wheeler River. During the year we successfully constructed and commissioned the FFT facilities, and carried out both the leaching and neutralization phases of the FFT. Our recovery of uranium bearing solution (“UBS“) with the use of the ISR mining method is a first in the history of the Athabasca Basin region, and now we have achieved another landmark accomplishment with the restoration of the test area to environmentally acceptable pH conditions. The work was done on schedule and without any recordable safety incidents – which is a testament to the hard work and professionalism of our dedicated Saskatchewan-based staff of geoscientists, engineers, metallurgists, process operators, well field operators, and contractors.“
Another unfortunate breakdown of a technical pattern with Denison Mines dropping below a triangle. I would be watching to see if we can close above $1.60 to nullify this breakdown, but what I expect to see is a retest of the triangle and another leg lower. If spot uranium continues to decline, then we can test the $1.30 zone.
Skyharbour Resources (SYH.V)
Skyharbour Resources (SYH.V) today announced that it has engaged with Condor Consulting Inc. to conduct geophysical and geological data compilation and interpretation work on Skyharbour’s Russell Lake Uranium Project.
Condor will process, model and conduct analysis of all geophysical data. The consulting company has extensive experience and expertise in the Athabasca Basin and in uranium exploration. They have worked on the Russell Lake Project under previous operators.
Since there has been numerous geophysical data covering Russell Lake, Condor’s work will ensure the success of geophysical compilation and future drill programs moving forward as Skyharbour readies to commence a fully funded and permitted 10,000 metre drill campaign in coming weeks.
By re-examining historical data using modern processing and modelling techniques, optimal drill targets can be obtained.
Technically, Skyharbour remains unchanged from earlier technical analysis articles. The stock remains very close to a major support zone at $0.325, and could form a double bottom reversal pattern. The key trigger for bulls however remains a break and close above $0.425.
CanAlaska Uranium (CVV.V)
CanAlaska announced an aggressive first quarter 2023 exploration plan. The company is preparing drill programs at two of its key projects this winter. An aggressive $10 million exploration program for the West McArthur Joint Venture project is scheduled to start at the beginning of January. The 2023 West McArthur drill program will focus on advancing the Company’s new high-grade uranium discovery, named the “Pike Zone”. The West McArthur project, a Joint Venture with Cameco Corporation, is operated by CanAlaska that currently holds a 79.4% ownership in the project.
The Company is planning a $1 million exploration program on the Key Extension project, located in the southeastern Athabasca Basin. The 2023 Key Extension drill program, planned to begin in February, will focus on phase one exploration of newly defined exploration targets generated through a series of geophysical programs completed in 2022.
CanAlaska is a tough one right now. Clearly, the $0.425 zone is a major flip zone which has acted as support and resistance in the past. It looked like we were going to shoot higher, but instead we closed below. Perhaps another double bottom could form if we find support here close to the $0.36 zone.