I just wrapped up an extensive video on the cannabis sector, including an overview of the charts all 29 individual pot stocks on my cannabis watch list. As the video is currently in the processing & uploading stage & won’t be posted for a while, I figured that I would share a couple of the comments/replies that I had recent posted in the trading room which sum up my thoughts:
j1persi- I’m not. Looking at the truly explosive gains in so many of these mostly bulletin board & pink sheet OTC stocks (i.e.- very questionable fundamentals) and while admittedly not knowing enough about the potential for those companies should most of all of the states that are about to vote on legalization of marijuana for medical or recreational use, I’d be willing to bet that a very large portion of that potential, assuming the majority of the states where legalization is expected to pass, has already been priced in for the foreseeable future.
If I am correct (a big IF) that means that the pot stocks may have already fully or possibly over-priced in the most optimistic scenario (the number of states where a YES vote is expected, especially CA, does so) then there risk of a massive rush for the exits, should fewer than expected states vote YES, is quite substantial & as such, I do not believe that the R/R to adding any new exposure to the marijuana stocks until after the elections is favorable.
Quite possibly a “buy the rumor, sell the news” scenario setting up in the pot stocks. JMHO & I welcome feedback from others on this.Personally, I’m sticking with my core holdings in the marijuana stocks from positions taken back a couple of months ago before the big run & do plan to add at some point in the future but only after the elections & maybe not right away.
Quite possibly a “buy the rumor, sell the news” scenario setting up in the pot stocks. JMHO & I welcome feedback from others on this.Personally, I’m sticking with my core holdings in the marijuana stocks from positions taken back a couple of months ago before the big run & do plan to add at some point in the future but only after the elections & maybe not right away.
Ruben posted an update 8 days ago
Randy,
Can you please give us an update on MJNA and the sector. Thank you.
rsotc replied 7 days ago
Ruben- The cannabis stock probably warrant another video overview at this point which I will try to get to asap possible but here’s my quick take:
A good percentage of the cannabis stocks on my watchlist (29 stocks in total) have experienced some profit taking in recent weeks after some explosive gains. Several of the charts of those stocks appear that the recent profit taking may be over and might have simply been consolidation/continuation pattern, similar to bullish flag or pennants formations (AMMJ is a good example of this, looking to have just broken out of a bull flag on Friday & following through today… daily chart).
Therefore, while the momentum in the sector as a whole has waned in recent weeks, it most certainly hasn’t ceased or reversed to the downside. In fact, some stocks have just recently started moving sharply higher or have yet to take a break following days or weeks of gains.
Again, I’m focusing on the group as a whole more so that just what one or two cannabis stocks are doing. Personally, after reducing quite a bit of exposure to the sector over the last few weeks, I prefer to hold off on adding back any more exposure right now as the gains in many of these stock, especially the penny stocks, has been too much, too fast without any solid material change in the fundamentals recently other than the expectation that recreational and/or medical marijuana may be legalized in some more states with (if my facts are correct), 5 states, including CA (a state with a GDP bigger than most countries) with recreational marijuana on the ballot & 3 states with medical marijuana on the ballot (plus Montana voting to ease restrictions on marijuana use).
As such, buying the pot stocks here or carrying a large exposure in the sector into the elections will be a crap shoot that could go either way. Even if the majority of the states vote yes, how much of that has already been priced in?
I continue to hold a core exposure to the sector with very small positions scatter among many different pot stocks but at this time, would prefer to hold off before adding any more exposure other than maybe sprinkling a little cash on a few of the stocks that I don’t already own that I’ve since come across & the charts look good.
I can’t see anything in the chart that tells me to sell MJNA as the stock continues to rise in a parabolic run but I have no desire to add to it at this time. Next significant resistance comes in around 0.169 or so but just be careful as these stock can & will (at some point) fall as fast or faster than they rise. Again, I will do a comprehensive update asap.
Therefore, while the momentum in the sector as a whole has waned in recent weeks, it most certainly hasn’t ceased or reversed to the downside. In fact, some stocks have just recently started moving sharply higher or have yet to take a break following days or weeks of gains.
Again, I’m focusing on the group as a whole more so that just what one or two cannabis stocks are doing. Personally, after reducing quite a bit of exposure to the sector over the last few weeks, I prefer to hold off on adding back any more exposure right now as the gains in many of these stock, especially the penny stocks, has been too much, too fast without any solid material change in the fundamentals recently other than the expectation that recreational and/or medical marijuana may be legalized in some more states with (if my facts are correct), 5 states, including CA (a state with a GDP bigger than most countries) with recreational marijuana on the ballot & 3 states with medical marijuana on the ballot (plus Montana voting to ease restrictions on marijuana use).
As such, buying the pot stocks here or carrying a large exposure in the sector into the elections will be a crap shoot that could go either way. Even if the majority of the states vote yes, how much of that has already been priced in?
I continue to hold a core exposure to the sector with very small positions scatter among many different pot stocks but at this time, would prefer to hold off before adding any more exposure other than maybe sprinkling a little cash on a few of the stocks that I don’t already own that I’ve since come across & the charts look good.
I can’t see anything in the chart that tells me to sell MJNA as the stock continues to rise in a parabolic run but I have no desire to add to it at this time. Next significant resistance comes in around 0.169 or so but just be careful as these stock can & will (at some point) fall as fast or faster than they rise. Again, I will do a comprehensive update asap.
j1persi posted an update 5 days ago
Is anyone picking up or adding to MJNA after this large dip today
rsotc replied 5 days ago