HIGH RISK

This is a BONUS report, but please know in advance that this report is not being written to encourage all of my readers to invest in this area. It involves what could be considered higher risk trading, so while I welcome everyone to read it through, please know who you are as a trader / investor and do not take unnecessary risk. Look at that Theme picture again.  If that is not you, then please proceed with caution. 🙂

Sidenote: Yesterday the USD did as I have been expecting & hoping that it would.  It is likely Left translated with a peak on day 8.  Perfect.  It is also due for an ICL in the near future,  even better!  Gold and GDX crossed the 10sma and broke overhead trend lines.  I expect weeks of upside, and based on my reports, you should own Miners now, buy dips.  More in the weekend report.

Why this report now? I have wanted to discuss a sector that has been acting quite bullishly for months now, but I didn’t want to distract from the Set Up that has been forming in the Precious metals sector.   RIGHT NOW I think that MINERS are the place for most to be investing in, at least for the next few weeks minimum.  I promise that I will mainly be focusing on Precious Metals going forward, I am very bullish in that sector right now. What I am about to discuss is an area that some more experienced traders could possibly scalp trade the set ups that I will be showing, or anyone can keep an eye on this sector, and  study it going forward.

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Medical Marijuana:  Please excuse my rather rookie discussion here. Medical Marijuana has now been legalized in many areas.  Research has shown that it could be used as a more natural approach  to treat a great variety of ailments, with less harmful side effects than current treatments.  In anticipation of that upcoming vote in the U.S. this past fall, I started studying different stocks in this sector to see how they move and also to see what I could learn from them. Like Energy, Solar, Miners, Biotech, Semiconductors, and so on, different stocks can have their own personalities.  I wanted to take a closer look into this sector, since it began to look like legalization of the increased use of Medicinal Marijuana was going to pass.  Again, discussions are being held indicating that it may have many uses that are not be as harsh or addictive as other chemical medicines used today. It could replace Pain killers ( Opioids) , anti-anxiety medication, appetite enhancers for Cancer patients, insomnia medicine, etc.  If this sector becomes a legal and more popular way of treating a wide variety of illnesses, these small companies are at their early stages of growth and could grow rapidly like other biotech stocks.

Again, being a new industry, I cannot emphasize enough that the risk in this sector is much greater than normal.  I have seen extreme volatility in this area already.  I was NOT even going to cover this sector for 2 different reasons ( 1. volatility and 2. possible moral pause) , but I figured that if I write an entirely separate report about it and label it as ‘high risk’, then I have made it perfectly clear that this is not to be considered normal trading for the less risk tolerant traders.  As for Moral reasons, many of these companies are now being viewed in the same light as pharmaceutical or medical grade providers and include eating the product infused with cannabinoids and not smoking it.  I WILL TRY NOT TO discuss companies in this sector that strictly provide vapor smoking methods of distribution or smoking products due to my strong personal feelings in this area.  I had someone ask me about the Philip Morris (or Altria) stock years ago, and I just cannot endorse investing in that product after knowing that it has directly been linked to premature death in millions of smokers from cancer.  I will not even look at the chart of cigarette companies or vape only marijuana companies if I know that that is their method of distribution.  Thanks for understanding.

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So I am discussing the recent passing of laws approving Medical Marijuana, which can include Infused foods, beverages, etc.  Note: I have not done enough due diligence in this area yet, but I have read probably 100 articles or company profiles for various companies in this sector.  It is a new sector, thus the volatility and risk of the unknown is present.  That said, let’s just look at the charts of this sector from last August onward.  This gives us the view of the time when voting on the use of marijuana as a legal medicinal product was approaching. Some of these stocks took off like rockets, moving hundreds of % higher in weeks. Now we have seen consolidation of those gains.   To the charts!

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NDEV DEC 9th CHART #1 – NDEV ran a huge % amount last September, moving from 3 cents to 55 cents!  It then went sideways and formed this base.  You will notice that many have formed this type of base.  This was a 25% pop from that base on Dec 9th, back to 32 cents. Is that all she has in the gas tank, or could it go higher?

NDEV DEC 27 CHART #2 – From 32 cents on Dec 9 to $1.50 ( About 400%)  in 2 – 3 weeks.  That is 3 cents to $1.50 since October.  WOW! That was over 2900%.  Rare example, but crazy move in 2 months for sure.  High risk?  yes, this could now drop to 60 cents and remain absolutely bullish.  My point?  I’m showing how that pull back and consolidation after October brought about the next move higher.

CBIS DEC 21 CHART #1–  A 1 cent stock jumped to 7 cents in October.  After pulling back, it was pushing on the 50sma and volume kept popping higher in this consolidation phase. It looked ready to break out.

CBIS DEC 27  CHART #2 – In the next few days, this one almost doubled once it got above the 50sma. When I see this type of buying interest and then consolidation in a sector that has just recently been accepted and legalized as medicinal, it might be worth looking into the company.

CBIS Today –  Please note the drop off of the top on Wednesday.  That was a BIG %-DROP.  It looks to be consolidating, and may form a cup & handle here?

So let’s take a look at similar chart set ups in this sector that have

1. Run up in the October time period due to the vote for legalization, and then 

2.  The consolidation that may lead to another run higher.  

We are looking for a run up last Oct & November,  and then a drop into a base. And please, check out the weekly charts on your own! Look for price to drop back to the 10weekly ma.

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CNAB – CNAB has just popped from roughly $1 to $1.75 in 2 days. It would be hard to buy an extended stock like this, because you could buy here and watch it drop 35%.  Buying a dip from here might work if your due diligence shows that CNAB is making progress in this sector. The weekly chart does show it at the 10ma.  I’m showing it to show how these bases are popping. I love the wedge within the base.

HEMP DEC 27 – HEMP is moving toward the 200sma. Last October 23rd this stock popped roughly 100% in 2 days. If this pushes along the 200sma with good volume pops, it may be setting up to break out.

HEMP UPDATE DEC 29 : A run to October highs is a 100% move.

MJNA WEEKLY – 4 cents to 27 cents, and then back to 8 cents.  Now rising and at 18 cents.

MCOA DEC 27 – I bought this Monday, simply because it broke from a wedge within the base. I plan on just holding it for weeks and seeing what happens. A break below the wedge would have me sell it. The move doesn’t look extremely big so far, but it actually is. It popped 50% on the 27th.  The problem is that it is a 5 cent stock, so I dont want to risk too much money here. If this runs from 5 cents back to 20 cents , that is a huge gain on a small position.

MCOA UPDATE: Possible bull flag. The dilemma: Should I add if it drops to the 50sma, or just keep it small and reasonable? I do like the set up.

CNBX – This one has yet to POP, and I can’t tell if this has further basing to do or is it ready because the sector is ready? No guarantees that it will, but a run to the Nov highs is over 100% from current price, and it did just regain the 50sma.  EDIT: Lost the 50sma Thursday and continues to consolidate. Researching this company may be a good idea.  It popped from 4 cents to $1.75, it may have a good foundation in this sector.

GRNH – Up 20% Tuesday, so how can you buy such an extended stock? Last October I simply took a small position and bought a pop then – and it ran 300% in 3 weeks.  unfortunately, it was a SMALL POSITION  🙂    A run to Oct highs in 100% from here.

GRNH UPDATE : A run to Oct high is 100% move.

EDXC – This looks to just be starting out of its base.  Former highs are about 100%. They have a patent for a food product infused with cannabis to help calm down dogs dealing with anxiety, like separation anxiety when their owners go away. They sell the product, I believe I read that they doubled revenue and expect continued growth.  The company is only 4 cents, so it is hard to have strong convictions in it, but it may be worth watching going forward or a SMALL purchase as it bases out above the 200sma.

So here, I am just pointing out that the 1 day drop to the 10sma was pretty big %-Wise, but then it still ran higher. This just shows the volatility that could be involved with holding these stocks.

HEMP had a 1 day drop on Dec 28th, and it was a 10+% drop.

HEMP TODAY –  That 1 day drop looks normal then next day. Again, these move big and can be hard to hold.

GRNH had a 1 day drop toward the 10sma was about 10% down at one point.

GRNH –  That 1 day drop reversed Thursday.  So again, I’m trying to show how quickly they move in either direction. This may make them hard to hold on to. 

In conclusion: What is the point?

– It is possible that after looking at these charts, you may want to buy A SMALL POSITION in 1 stock in this new & growing sector (a buy & long term hold). If you find a solid company with growth potential, it can lead to big gains down the road. The sector does now look like it is here to stay and grow.

-If these stocks pull back , you may do research and look for a low risk entrance.

-These are high risk and move quickly, so small money amount positions are recommended, this is NOT a get rich quick trade.

-If you cannot handle this type of trading, please do not enter a trade! Maybe you just want to keep an eye on the sector from time to time. Make a check list, research some companies. See how they grow going forward. Note:  I CANNOT guide you through these trades daily.

I DO NOT know everything about each company here. I have done some reading and suggest due diligence on the part of anyone interested in knowing about company specifics.  Some are just starting to turn profit, others are spending money, buying and building huge facilities.

This is the real point for most people here. If these companies are in their infant stage and the growth potential is really as big as one would imagine, I would have to think that some of these companies could do very well over time. Why couldn’t a 10 cent stock of the right company trade at $10, years down the road?  Buying 10,000 shares of the right company at 4 cents a share costs  $400.00.  If that made it to $1 in a year or so, you’d have $10, 000.  If it went to $2, you’d turn $400 into $20, 000 and so on. There are big risks however, and a long period of time may be needed for these companies to develop and prosper.  Others may never succeed.

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Look at CANN – This was in the lower 30 cents area this year.

CANN – Went from 33 cents to $5.19 in 2016 alone.  VERY difficult to ride with these wide swings now, but if you got in early, you could just hold on.  $500 invested in this 33 cent stock last February would have become $7863. at the peak.  Not all will do this, but the sector has potential.

CANN WEEKLY BIG PICTURE – What if this went back to former highs?  $500 at 33 cents would become $60, 600.00! Ok, let’s not get crazy and think that everything in this sector will become 1000+% gainers, but there does seem to be potential growth in this sector where demand is likely to continue to increase. Finding the right company would be key.  A low risk entry point to help one sleep at night would also help.

AGAIN, let’s not get greedy and think that this is a great ‘get rich quick’ way of investing.  It is high risk, and you could lose everything that you put on one of these stocks.  Right now, I am seeing that just about all of these companies seemed to be jumping last October as the vote to legalize medical marijuana took place. They were benefiting from the recent change in environment, but how many will make it in the coming years? There is no way of telling without researching and due diligence.  MOST OF THESE STOCKS are OTCBB –  so they do NOT have to report to the SEC.  That means that they can also exaggerate about their potential, again making this higher risk.   Some companies may  financially struggle and not be able to compete, while others may be just in their infant stages and could continue to grow inside of this sector in a big way. There does seem to be growing approval of medicinal use of cannabis by Doctors, scientists, and patients across the United States now.

Some companies and their current prices that I have done some reading into and you may be interested in looking at the charts and profiles are below:  Some are producers, others are research and development, advisory companies. Be careful in this sector, some of these companies may no longer exist in the future too.