Uranium Energy Corp. UEC

DYK?🤔 As we approach February month-end price pegging of ❓

[mangoe]

John Quakes

@quakes99 -

DYK? As we approach February month-end price pegging of Spot #Uranium by #Nuclear fuel price reporters next week U should be aware of an associated short-term price dip anomaly referred to as the 'month-end smash' which is what we're seeing play out now.

There are some #Uranium traders who have supply contracts with a couple of producers who receive monthly deliveries that they pay for at the time of delivery priced at the previous month-end Spot #U3O8 price. They then quickly sell those lbs they've received into the Spot market to try to realize a nice profit.

Those traders' next deliveries in March will be priced at UxC's February month-end Spot price which will be pegged on Monday the 26th and/or TradeTech's month-end price pegged next Thursday the 29th. Traders have huge incentive to walk down the Spot price now to get it as low as possible so that they will pay the lowest amount possible on those March deliveries of a few hundred thousand lbs, in order to increase their profit potential next month.

The traders break into a dance routine that is well known by the buyers in the very small Spot market community. Traders will offer a small lot of lbs at progressively lower prices as the buyers pull their purchase orders, driving down the Spot price to as low as those traders are willing to push it.

When the traders high-five 'mission accomplished' as February comes to a close and the month-end Spot price has been set the game abruptly reverses to one where the traders want to sell the lbs they receive from producers in March at the highest possible price to realize maximum profits. So the traders jack up their asking prices to push the Spot price higher once again so that motivated buyers must bid up the price again to find willing sellers with lbs to sell.

This short-term price dip - the 'month-end smash' - used to be a monthly occurrence when there were only a few buyers and sellers active in the Spot market, but it disappeared as Spot prices surged and Nuclear utility buyers came back into the market eager to secure needed Spot #U3O8 to feed their conversion contracts.

However, after Spot broke through $100 we saw most Nuclear fuel buyers step back from the Spot market to see where prices would settle, as they don't want to keep bidding up a spiking Spot price that drives up the sticker price on future deliveries under their own long-term contracts that are 'market-referenced' to the Spot price at time of delivery.

That has set up the ingredients for a February month-end price dip that will play out now as buyers and sellers dance around prices. History shows that these are simply temporary events along the upwards trending Uranium price chart. With a deep and growing multi-year supply deficit, steadily rising Nuclear fuel demand and a number of potential U sector catalysts on the near-term horizon, resumption of the upward Spot price trend is inevitable over the coming weeks, months and years. Position your portfolio accordingly.

Hope that helps U! Good luck with your research and investments!