Bigger Picture

Note: I publish “The Universe” every weekend, updating my support and resistance calculations for Marijuana sector stocks. It is not a projection, but a handy reference… Non-Marijuana stocks are covered elsewhere during the week.]

Links to || Last week”s Universe || Prior week”s Universe || Previous week”s Universe ||

This is starting to get trendy.

For the past several months I”ve been listing one or two Cannabis stocks here. Over the prior week, they had developed accumulative patterns that pointed to at least a temporary rally. And they all have tended to produce substantial gains within the subsequent 1-3 weeks — often doubling.

Temporary bounces aren”t predicated on accumulation. Certainly, other stocks in the sector have bounced, too. Oversold and/or thinly traded issues need only a spark. Too often, that spark is confused by over-eager investors as being a valid investment thesis.

But those stocks exhibiting accumulation have responded reliably. And now the candidates are becoming more plentiful. Even several that were borderline, which I chose not to highlight, have still rallied sharply.

Sub-penny and thinly-traded issues are of no interest at this stage, including “falling knives.” If the sector”s strength is caused by a new influx of buyers. This week I”ll publish an update of recent performers that will offer a useful view of the types of issues likely to be most attractive.

24 stocks in 5 minutes. After my review of the market, Gold, and Crude Oil, I reviewed the cannabis sector. Then I addressed requests from the Activity Feed and by attendees, all in the following order:

EDXC

SPX

GLD

OIL

MDBX

GWPH

INSY

CANV

CARA

BLPG

TRTC

MYHI

NTRR

MSRT

MCIG

TAUG

OXIS

SRNA

USCR

FEYE

TASR

PPCH

GTLS

ECIG

VAPE

INSY”s peaking is becoming more widely obvious, and so is SRNA”s bottoming. We”ll look at these and other current setups, including your requests, during today”s Livestox

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Note: I publish “The Universe” every weekend, updating my support and resistance calculations for Marijuana sector stocks. It is not a projection, but a handy reference… Non-Marijuana stocks are covered elsewhere during the week.]

Links to ||
Last week”s Universe ||
Prior week”s Universe ||
Previous week”s Universe ||

This week”s issue of Barron”s magazine is out this morning. One of its weekly columns tackles an interesting subject. That is the broader market”s “breadth.” Whether comparing the number of issues rising to declining, the number of new highs vs. new lows, the percentages of stocks above and below various moving averages… the market is suffering from very bad breadth. (Get it? Bad breath, bad breadth?)

The columnist should look at the Cannabis sector. Or, not.

This has been the case for the broader market for some time. Which is one reason why I”ve been viewing it as forming a broader top. And a big reason why I urge everyone to learn about bearish index ETFs and short-selling.

But breadth is not a timing tool. Big turns don”t happen quickly. It”s the world”s largest game of Musical Chairs, and its players know how to stretch out each round. The broader market stays afloat through “rotation” among sectors, where fewer take on the mantle of leadership. Eventually, fewer components of fewer sectors are leadership, and the game ends on account of too few chairs remaining.

The Cannabis sector”s leadership has been to the downside. Not bigger cap stocks like CARA, GWPH and INSY, but smaller and microcaps. Their winners have been exceptions. And its winners at any given time have largely proved only to be temporary bounces.

Patience and stalking for our own bottoming candidates have continued doing well. The most recent was TRTC, which spent only two days at its sub-.09 target before beginning a one-week surge that doubled it. (and you know what I say about penny stocks that double, right?) The latest pattern to suggest it”s forming such a bottom is SRNA.

Last week”s major Cannabis sector revisions were few. Not just the percentages of stocks above or below 4-week moving averages, but also those closing under support. The majority of new lows have been among microcaps. Stability is not a buy signal. But there were even a couple of resistance recalculations to make. More of that would start being bullish.

SPECIAL OFFER: I”m re-opening my market timing chaRTroom to my stock subscribers for a free week. No cost and no registration required. Just message me on the system.