Far East Capital Newsletter
A-Cap is reassessing its giant uranium orebody
25 Jun 2022

In This Issue

Weekly Commentary

A-Cap is reassessing its giant uranium orebody

The market continued to ease over the week. Many charts hit new lows, though there were a number that started to crawl back as bottom fishers moved in. At the close of the week there were 76% of stocks under coverage that were in downtrends. Once the percentage gets greater than 70%, whether it be stocks in downtrend or uptrends, you know that you are close to the turnaround point - within 2-3 weeks. What these numbers don't tell you is whether it will be a quick recovery or something more extended while confidence gradually recovers.

Not every stock falls when the market melts down. There will always be a few that are running on their own merits irrespective of what is happening in the broader market. Lindian (LIN) is a perfect example, closing at a new high on Friday afternoon. We first mentioned Lindian a couple of years ago, citing its high grade conglomerate bauxite projects in Guinea. While the bauxite still holds strong merit, the recent enthusiasm has been more about the high grade rare earths project in Malawi that we referred to over the last couple of weeks.

Last week I mentioned that gold producers were among the best performers in the violent selldown we have been experiencing in the stock market. Their performance has confirmed the view that gold is first and foremost a safe store of money. Gold is an insurance policy for your portfolio, more so than the speculative asset that many traders want it to be. 

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