It looks like this week there is positive mood among investors about the shares of Ucore Rare Metals Inc. (CVE:UCU), (PINK:UURAF). Since Monday, the stock has gone up by 16%. Yesterday the rise was supported by a heavy volume exceeding three times the average turnover.
In the lack of fresh news from the company one must look for other possible causes for the run-up on Ucore’s shares. Probably the surge was triggered by a new stock alert from the beginning of this week.
It drives readers’ attention to the great potential of the rare earth metal market, described as “the biggest bull market” currently. Surely, this is facilitated by the extraordinary China export quotas for rare earth elements (REE). China provides about 97% of the world REEs and its export restrictions will lead to a huge increase in the demand for rare metals worldwide. Ucore should seize this opportunity and profit from the situation.
And the company has the ability to do this. The latest published assay results from the trench program at its Bokan Mountain project in Alaska confirmed the enriched heavy rare earth content at the property.
As known from geology, trenching is making a narrow and shallow ditch cut across a mineral deposit to observe its character or to obtain samples.
Something similar to “trenching” will be needed by investors if they want to predict the future change in the price of the company’s stock. But judging by Ucore’s financials, UCU will probably have tough times on the market. 
The company’s financial reports show some negative signs. The net loss for the Q3 2010 is $450K, or 20% bigger than the corresponding period the previous year. At the end of September 2010, the company had $459K in cash, which is almost 37% down from the figure in 2009.
The completion of a $10M private placement at the beginning of December certainly helped Ucore Rare Metals secure additional funds. This will allow the company run more easily its numerous projects.
