Bigger Picture

The recording of today”s Livedesk can be viewed here:
http://new.livestream.com/accounts/7617211/events/2865745/videos/50832466

Thank you to everyone that attended, and for all of the great questions. If yours wasn”t addressed or needs elaboration, please post it below. Thank you!

Livedesk at 11:11 ET. Maybe I”ll start 1 minute earlier so we can also say 10:10 CT. And if we set a time limit to end at 9:09 PT, then we”ll finish 1-2 minutes before beginning. Now, that”s efficiency.

Sorry. Livedesk at 11:11 ET.

Here are my comments in the prior thread:
TAUG — The pullback limit, combined with my earlier comment about weak volume creating vulnerability to momentary dip…
TTDZ — .018-.020 is strong support. Closing under there would be very bearish…
FITX — I”m not a buyer of this dip…
TRTC — Early fluctuation probed fresh highs at .50, but still fluctuating around unchanged…
IGRW — Relentless opening dip has fallen from .05 to .041…
MYEC — Haven”t been covering beyond weekly comments, but this opening surge is impressive.

Good morning!

It”s day-two of another bottoming attempt for the sector. As I noted in last night”s Open”s Interest issue about yesterday”s action, volume still left something to be desired. That”s not necessarily bearish, not yet. Volume can”t be strong at THE low, because THE low can”t be widely recognized or acknowledged.

By the same token, don”t let yesterday”s price surges lure you into chasing strength, not without good reason for making the exception. Lighter volume creates the vulnerability to dips — albeit not having any assurance of whether a dip is only a temporary pullback, instead of a reversal that is resuming the decline.

GWPH makes a presentation tonight, and a favorable reaction might see it suck the oxygen out of the room again when markets react tomorrow. That, and “earnings” announcements timed for this week from among the sector, might also inhibit today”s price action.

I”ll post opening observations in the Open”s Interest thread…

Welcome to Open”s Interest for Tuesday

(Setups and parameters are below…)

Thank you all for the feedback Monday on how you use this service. I encourage everyone at least to click here and to read the comments for any tips.

I wrote a weekly Filter THIS! column. Its message was that the recent interest in looking outside of the marijuana sector is reminiscent of a gradual exodus of traders I recall during the Mar 2000 – Oct 2002 bear market. So many had left, that prices couldn”t fall any further. And just when they were looking the other way, prices started rallying. 

Prices started rallying Monday, too.

Volume still left something to be desired. And apparently a lot of “earnings” announcements are hours or days away — those realities might bite. But I have to respect double-digit percentage bounces after my downside targets have presumably fulfilled selling pressure.

My review current Open”s Interest coverage includes strategies for entering either weakness or strength. Share your own tactics and observations in the comments for this post.

Current weekly universe coverage links: First half || Second half

Click here for the previous Open”s Interest issue parameters.

Reminder to SAVE THE DATE for a webinar/Livedesk this Thursday. We”ll start this one at 5:30pm ET, and  review the service”s usage, including the information below…

Enjoy!

Breakout (consolidations or basing that is forming
an accumulative pattern )

IGRW .044 pullback ||.062 resistance || .044 stop || .10 target
Raised resistance parameter

(- INSY short) no support || 29.70 bounce || 29.70 stop || 22 target
Lowered stop and resistance after 31.55 support break, still bearish

Pullback Limit
(breakouts and bounces that have retraced 61.8%…
these situations are often make, or break)

none

Bottom Fish
(basing after extended decline — not really a “trade”)
(breakdown unconfirmed a 2nd day — only buy strength)

STEV no pullback || .17 resistance || .145 stop || .21 and .25 targets
Potential was kept alive by last-minute surge Monday

Third-day Surge
(2-day surge to fresh highs at risk of peaking — don”t chase higher)

none

Not a Charm
(third test of retested low — lower lows coming?)

(- VAPR ) .11 support || .15 bounce || .135 stop || .05 target
Lowered stop after Monday”s fresh low.

Falling Knife
(trying to catch the reaction to a steep drop — ouch)

FSPM no pullback || 2.65 resistance || 2.40 stop || 4.00 target
Not yet rallying by noon Tuesday could disqualify the pattern

ICBU no pullback || .05 resistance || .034 stop || .077 target
Not yet rallying by noon Tuesday could disqualify the pattern

MCIG .375 pullback || .45 resistance|| .34 stop || .57 target
Bounced sharply off of .34 support Monday, BIG reversal setup

TAUG .029 pullback || .035 resistance || .027 stop || .055 target
Corrected opening bounce into .29-.31 support, can”t delay rally

TRTC .46 pullback || .52 resistance || .43 stop || .64 target
Raised parameters after Monday”s rally from .40 sup through .43 resis

Rocket Launch (sudden explosive interest that gains traction)

none

Monitoring
(observations of other stocks of interest)
BRDT “not a charm” may be forming.
GWPH want to cover the short before Wednesday”s close.
MWIP must avoid lower lows to finish its C&H
TWMJF almost any strength on volume for “pullback” to end.
VAPE fresh low testing 2.00 for “bottom-fishing.”
VPOR “not a charm” may be forming.

The video also mentions EAPH, ATTBG, TTDZ, MWIP and FITX.

Open”s Interest is the daily pre-open reference for marijuana stock patterns currently of interest, including other insights and overviews.

Today”s one thing is… Plus ça change.

“Plus ça change, plus c”est la même chose.” The more things change, the more they remain the same. Ecclesiastes” version isn”t too dissimilar: “There is nothing new under the sun.”

I”m referring to you. (Referring, not reefering. That”s another article.)

A stock picking service I launched in 1995 was in the thick of the internet boom (both the stock sector, and being among the first to set up practice there. The internet stock mania had inspired encouraged the broader market higher into 2000, for a month of topping that led to a huge collapse.

The next two years were difficult for individual stocks. My charting wasn”t surprised by the top and the turn, but I had no forecast for its duration. My short picks were doing well, but not too many subscribers want to trade in that environment. (That”s when I first began applying my methodologies to other markets, including futures, that hardly distinguish between long and short.)

Subscriber growth began expanding again in August 2002. Many were returning after having thrown up their hands in disgust at the persistent downtrend about two years earlier. Man must trade, so eventually people began accepting the new paradigm, and came home.

Here”s what reminds me of this.

Last week, popular demand led me to offer non-MJ analysis. Our sector teased at a bottom on April 15, which has held for many individual stocks, but not for enough. Renewed selling was reminiscent of the drops into April”s lows, and only a couple of marijuana stocks can be shorted responsibly. So, “let”s broaden our horizons, Rod,” was repeated often into the weekend.

I recognized it immediately, and added a lot of names to the daily Open”s Interest parameters. And a lot of marijuana sector names surged this morning, with multiple double-digit gains. The last time a big bear market finally pushed away enough bulls that they were willing to accept that environment as the new reality, the reality had already begun changing back. The same might apply to the marijuana sector”s recent decline, and the sudden surge among subscribers in wanting to shift their focus.

The first reaction up was pretty steep. I”m not assuming the sector is reversing straight up from here without hesitation. But the cycle of boom to bust isn”t an imaginary invention. It often extends from there to back-off, and to back-in and back up.

Until proved otherwise, it”s Déjà vu, all over again.