Bull-Bear Fight Heating Up in Rare Earth Momo Stocks (MCP, REE, SHZ)
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If you're a momentum trader then you've probably seen the meteoric rise in rare earth stocks recently. The moves in these stocks comes as China, the world's largest producer, may cut their exports.
Two of the early movers in the sector have been Molycorp, Inc. (NYSE: MCP) and Rare Element Resources Ltd. (NYSE: REE). MCP, which IPO'd at the end of July, is up 190 percent from its post-IPO low of $12.20. REE is up 312 percent during that time frame. China Shen Zhou Mining (NYSE: SHZ), a late runner, is up 215 percent in just the past three days.
Today, Rare Element Resources is taking a breather as comments from the CEO, reported by CNBC's Fast Money yesterday, suggests a stock offering could be forthcoming. Don Ranta said, "we'll also better financing options and it's better for raising money for contining and developing projects. Haveing a lack of rare earth is not good, but it is good for business because it drives up prices and share prices.
In addition to the cautious Fast Money mention, Rare Element was the subject of a negative article at SeekingAlpha, which recommended the stock as a potential short. "After sifting through the hype, we believe there is tremendous risk in RE stocks and highlight Rare Element Resources (AMEX: "REE" $12.74/ TSX: "REC") as a potential short opportunity, or at least a stock investors should avoid," the report from Shareholder Watchdog said.
Share of REE are down nearly 8 percent today. MCP is up 7 percent, and SHZ is up 2 percent today.
Two of the early movers in the sector have been Molycorp, Inc. (NYSE: MCP) and Rare Element Resources Ltd. (NYSE: REE). MCP, which IPO'd at the end of July, is up 190 percent from its post-IPO low of $12.20. REE is up 312 percent during that time frame. China Shen Zhou Mining (NYSE: SHZ), a late runner, is up 215 percent in just the past three days.
Today, Rare Element Resources is taking a breather as comments from the CEO, reported by CNBC's Fast Money yesterday, suggests a stock offering could be forthcoming. Don Ranta said, "we'll also better financing options and it's better for raising money for contining and developing projects. Haveing a lack of rare earth is not good, but it is good for business because it drives up prices and share prices.
In addition to the cautious Fast Money mention, Rare Element was the subject of a negative article at SeekingAlpha, which recommended the stock as a potential short. "After sifting through the hype, we believe there is tremendous risk in RE stocks and highlight Rare Element Resources (AMEX: "REE" $12.74/ TSX: "REC") as a potential short opportunity, or at least a stock investors should avoid," the report from Shareholder Watchdog said.
Share of REE are down nearly 8 percent today. MCP is up 7 percent, and SHZ is up 2 percent today.
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