With serious supply chain problems now set to be compounded by war and sanctions, etc., energy and raw material prices look set to go higher and higher and that includes uranium, which is already starting to move. Azincourt Energy Corp. (AAZ:TSX.V; AZURF:OTC) is a uranium company that looks set to benefit from all this, and right now it is at a good entry point after trending broadly lower for about a year.
We’ll start by looking at a long-term 10-year chart on which we see Azincourt has been marking out a low compound base pattern from as far back as late 2014 with several attempts to gain upside traction having failed, up to now. This compound base pattern follows a severe decline from a peak in 2014 at much higher levels and as we can see the latter part of the base pattern has taken the form of a Pan & Handle base, with the strength of its volume indicators over the past year or so suggesting that this time it is going to get on with it and enter a sustainable bull market. One reason that the stock has remained depressed may be stock dilution, as there are now almost 500 million shares in issue, so we shouldn’t expect it to recover to its former highs, although it might given the rosy outlook for uranium, and the company is a larger concern now with various “irons in the fire.”
There are several points of interest to observe on the 2-year chart, which shows the latter part of the Pan & Handle (or Cup & Handle depending on the scaling). On this chart we can see more clearly how the accumulation line has held up very well as the price has reacted back to form the Handle of the pattern, which certainly increases the chance of a new bull market getting started. The current tight bunching of price and moving averages is creating a potent setup of the sort that frequently leads to significant gains. Lastly we see from the position of the MACD indicator that it is not overbought at all here and has a lot of upside potential with this indicator also showing upside momentum is improving.
The 6-month chart shows that Azincourt is starting to rally off the second low of a small Double Bottom that has formed over the past couple of months with the strong upside volume this month pointing to not just a breakout from this pattern but also from the larger Pan & Handle base that would probably lead to a period of quite rapid advance.
Azincourt Energy is in summary viewed as an attractive and not especially speculative buy here for all timeframes. It trades in good volumes on the US OTC, which is not surprising given the number of shares in issue. As ever on this market limit orders should be used to avoid being fleeced.
Azincourt Energy website
Azincourt Energy Corp, AAZ.V, AZURF on OTC, closed at C$0.075, $0.06 on 28th February 2022.
Originally posted on CliveMaund.com at 9.40 am EST on 1st March 2022.
Clive Maund has been president of www.clivemaund.com, a successful resource sector website, since its inception in 2003. He has 30 years' experience in technical analysis and has worked for banks, commodity brokers and stockbrokers in the City of London. He holds a Diploma in Technical Analysis from the UK Society of Technical Analysts.
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The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.
