We have strong conviction that compelling supply-demand fundamentals and near-term industry catalysts will spark a recovery in deflated uranium prices and reverse the recent downward trend in equity valuations. These potential catalysts include (i) resumption of Chinese newbuild approvals by year-end 2012; (ii) further restarts of Japanese reactors in early-2013; (iii) and end of the Russian HEU supply agreement in December 2013. In 2014 and beyond, we believe fewer 'low hanging fruit' deposits, higher incentive costs, and a three-year supply deficit (2014E - 2016E) should push uranium prices north of US$70/lb (vs. US$50.15/lb today).

We are resuming research on the uranium space with coverage of three producers: Cameco (CCO-TSX), Paladin Energy (PDNTSX), and Uranium One (UUU-TSX); two juniors: Denison Mines (DML-TSX) and Ur-Energy (URE-TSX) and one fund, Uranium Participation (U-TSX). Our preferred names in the space are Uranium Participation and Cameco, and for more risk-tolerant investors, Ur-Energy. We also highlight Uranium One, which has the highest leverage to spot prices of the group.

David Fuller's view Well done Raymond James for putting down a marker when this out of favour and nearly forgotten energy sector is arguably cheap relative to its eventual potential.

"Timing is Key", as they write on page 3 and indeed it is. The points Raymond James makes are interesting, and this report is well worth the read, in my opinion. Nevertheless, I would be very pleasantly surprised, as a stale bull of Cameco and Denison, if the sector recovered anytime soon.

While the global economic slowdown continues, mining shares are likely to underperform. When this cyclical sector does start to improve, I suspect that uranium miners will be at the tail rather than front end of the recovery. Despite this, we should keep an eye on the charts because 'sleepers' of this sort have a habit of springing to life very quickly and strongly, once the long hibernation is over.

Most of these charts show slowly developing Type 3 base formations as taught at The Chart Seminar. In other words, much more quiet ranging than churning, and plenty of time and size of pattern: Cameco (leading) (weekly & daily), Denison Mines (weekly & daily), Paladin Energy (underperforming (weekly & daily), Ur-Energy (benefiting from RJ's recommendation (weekly & daily), Uranium One (weekly & daily) and Uranium Participation Corp (weekly & daily).

The actual uranium price is also slumbering and needs to start rounding upwards to show evidence of interest. It will happen but I am certainly not holding my breath.