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Coronavirus-bear-market-2020-analysis

Marijuana Stocks Ready for Another Massive Rally?

Companies / Cannabis Feb 14, 2019 - 01:22 PM GMT

By: Chris_Vermeulen

Companies

Our research team has been actively discussing the potential that the entire Marijuana stock sector could be setting up for another upside price rally.  Since the bottom set up in the US stock market near December 24, 2018, many of the cannabis-related stocks and ETFs have seen incredible upside recoveries (of 25% or more).  We believe the current setup in MJ, the Alternative Harvest ETF, is indicative of a new bullish momentum breakout.

The upside potential for this move is likely 12~25% or more over a short span of time.  Watching MJ move from $34 to $39 over the next few weeks could result in a 14%+ move where a breakout of $39 to the upside could see MJ retesting recent highs near $45 (a +32% upside move).


One aspect of this market sector to consider is the recent talk of nationalizing legal US cannabis in the US as well as the expected gains in state sales from legalizing the industry.  We’ve all read about how some of the largest drink and tobacco producers in the world are investing heavily into this blossoming sector in preparation to secure market share when the dust settles.  The entire Marijuana market sector could be a boom cycle, similar to Cryptos in 2016~2017, over the next 12~24+ months in the USA. Canada recently legalized its use which could help open the door for other territories to make it legal.

MJ has room to run to the upside and our initial projected targets for this upside move are just below $38.  If our longer-term analysis is correct and the US major stock market indexes continue to rally, we believe MJ could attempt to retest recent highs near $45 over the next 30~60+ days.

These types of opportunities don’t happen very often. Fledgling industries with strong interest drive investors to make speculative plays while driving prices higher and higher in most cases.  Play this one smart and look to take profits above +8% on no less than half of your initial trade, then let the rest of your position ride out the run.  If we are correct in our targets, $41~44 should be the next upside target before resistance is found.

Another interesting way to look for interest in any sector is to look at the Google Trends for the search term popularity for a particular asset class or similar related phrases and Bitcoin is the perfect example.

Marijuana Stocks Searches

As you can see in the graph below Google trends is shows a steady increase of interest for “Marijuana Stocks” stocks.

We should warn you that this is also a capitulation and contrarian indicator once it breaks the 80-100 level. When search demand spikes and everyone is interested in these stocks that is when they top. So, we do expect a run-up in price, but after that price could go up in smoke as this is somewhat of a bong bubble in the asset class.

If you want to join a group of professional traders, researchers, and friends, then visit www.TheTechnicalTraders.com to learn how we can help you find and execute better trades.  Some of our recent winners are GDXJ 10.5%, ROKU 8.1%, two other open positions with 15.4%, and 4% as we wait for new a couple high momentum trades to mature.

We believe 2019 and 2020 will be incredible years for skilled traders and we are executing at the highest level we can to assist our member’s profit from our trades with us. In fact, we are about to launch our newest trading solution for ourselves and members that is unparalleled anywhere else.

Chris Vermeulen
www.TheTechnicalTraders.com

Chris Vermeulen has been involved in the markets since 1997 and is the founder of Technical Traders Ltd. He is an internationally recognized technical analyst, trader, and is the author of the book: 7 Steps to Win With Logic

Through years of research, trading and helping individual traders around the world. He learned that many traders have great trading ideas, but they lack one thing, they struggle to execute trades in a systematic way for consistent results. Chris helps educate traders with a three-hour video course that can change your trading results for the better.

His mission is to help his clients boost their trading performance while reducing market exposure and portfolio volatility.

He is a regular speaker on HoweStreet.com, and the FinancialSurvivorNetwork radio shows. Chris was also featured on the cover of AmalgaTrader Magazine, and contributes articles to several leading financial hubs like MarketOracle.co.uk

Disclaimer: Nothing in this report should be construed as a solicitation to buy or sell any securities mentioned. Technical Traders Ltd., its owners and the author of this report are not registered broker-dealers or financial advisors. Before investing in any securities, you should consult with your financial advisor and a registered broker-dealer. Never make an investment based solely on what you read in an online or printed report, including this report, especially if the investment involves a small, thinly-traded company that isn’t well known. Technical Traders Ltd. and the author of this report has been paid by Cardiff Energy Corp. In addition, the author owns shares of Cardiff Energy Corp. and would also benefit from volume and price appreciation of its stock. The information provided here within should not be construed as a financial analysis but rather as an advertisement. The author’s views and opinions regarding the companies featured in reports are his own views and are based on information that he has researched independently and has received, which the author assumes to be reliable. Technical Traders Ltd. and the author of this report do not guarantee the accuracy, completeness, or usefulness of any content of this report, nor its fitness for any particular purpose. Lastly, the author does not guarantee that any of the companies mentioned in the reports will perform as expected, and any comparisons made to other companies may not be valid or come into effect.

Chris Vermeulen Archive

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