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No telling what this will do to the pot stocks. I've looked at the DJIA vs the pot sector in the past and I never saw a strong correlation between the two. On days the broader markets were up big sometimes the potters would follow suit and sometimes they went the other way. Same thing on big Dow down days.
If we had a neutral broader market right now I mighta said that it looks like the pot sector could be close to bottoming out here, but with the big markets in a freefall all bets are off, IMO. The lack of correlation means the MJ stocks might hold up okay for awhile but if the selling off of the blue chips and high techs and damn near everything else continues I just don't see how a lotta folks who have some speculative money in MJ don't get all defensive and start pulling that out eventually.
I imagine some pot stocks might still do okay but I'm guessing not too many of them will fare very well in an environment like that. Guess we'll just have to wait and watch to find out. Only have 2 open positions right now so not much on the line at the moment.
Yep, I tried to warn you this could and probably would happen on the Aphria board last week. I was hoping we would have one more up & down cycle before the roof caved in but also said at the time that she could snap before then and that there was no guarantee that we would make it back to the upper trendline for one last go at it before the next low broke through that support level I've been talking about since I started posting here 2 months ago.
Got my Pop set up with some puts & calls on his biggest individual stock holding this morning so we are fully protected on that one and will probably do the same on his second biggest one on Monday. If the market goes down enough he will even make a decent chunk of change now.
Turns out we already had Level 0 approval from Schwab that allows you to buy puts on stocks you already own but we need Level 1 approval to buy speculative puts on stocks he doesn't. Hope they approve his application before the DJIA is below 20000...LOL.
Pretty sure this is gonna be very bad, J. I'm looking for a much bigger drop from here. But it will be very good if I can get those other puts in place in time. Hurry the hell up, Charlie! Time is money!
I took a quick look at the S&P 500 put options not too long ago. They seemed a bit expensive to me but I didn't analyze them that closely.
I tried a play like this back around 2006...turned out to be a couple years too early but probably woulda made $200K to $300K if I had timed it a little better. That was on a gamble of only $3-5K if I recall. That's how bad the crash was. Even super cheap deep out-of-the-money puts ended up being in-the-money with each contract winding up being worth a small fortune and I was sitting on a mountain of them.
Not gonna do anything that risky this time since it's my father's money and not mine. I'm looking at puts on individual stocks rather than market indices for this go-around...they can be had for less and will pay off just as well. Just to give you a rough idea what we could be looking at the DJIA and many stocks lost about 1/3 of their value in just 3 or 4 months back in 2008. And the double dip back in 2001-2002 wasn't any better.
This article was from back in April when we were sitting at a low coming off the January high...just like we're now sitting at a similar low coming off a similar high in October...
'Just Around the Bend': This Is When the Stock Market Will Crash, According to 5 Famous Investors
http://time.com/money/5235032/just-around-the-bend-this-is-when-the-stock-market-will-crash-according-to-5-famous-investors/
Last time I was 2 years too early...hope to hell this time I am not a few days too late! Right now given where we're sitting it could easily go either way from here...a nice rebound back to over 25000 or thereabouts and everybody has a nice Christmas while being lulled into a false sense of security...or investors have a miserable holiday season.
I'm focusing mostly on April puts and if we miss I may reload for a second round on ones for around July depending on how things are looking when the April options expire. The bulls & the bears are locked in a death match right now. The bulls won Round 1 back in March-April but I'm betting the bears win this one. Best of luck whatever you decide to do, J.
I'm still hoping for a market reversal and a year-end rally hopefully back over 25000 but that might be optimistic. That would allow us to get the best price when we sell covered calls and pay less for protective and speculative puts so would maximize the risk to reward.
But at the moment we are teetering on the edge of the abyss...could go either way IMO. If it does go back up I think the next down cycle is very likely all she wrote...game over for the longest bull market in history may he rest in peace.
I've been studying recent past crashes to get an idea what I can reasonably expect might happen to help me decide which puts I might wanna buy. Many people seem to forget just how bad it can get and just don't believe it will ever happen again...even though it does again and again. Those people just haven't studied past market history.
If I'm wrong we'll lose a few bucks but if I'm right we'll make more money in a nice bearish downturn than we ever would with these chickenchit swing trades I've been doing with the pot stocks. We're still up since we started in early September but that sure has come down a lot in the last several weeks. If people start losing their shirts on their blue chips and high techs they'll probably pull any speculative money they have in the MJ sector out.
I'm sure a few pot stocks can still sail against such a headwind as we'll likely be facing in 2019 but I doubt I'm nearly as good at picking which ones as you are. Best of luck, amigo.
23258...this ain't looking good.
Was hoping this old bull had one last snort left in him but he may get ripped apart by the big baby bear.
DJIA just hit 23365...just a handful of points above the critical support level of 23350.
Wish this Fed Chairman would just shut the hell up and go have a cold beer or something...the more he talks the lower we go. We want the market to crash in January or February...not December. We don't have our put options in place yet, dammit!
S&P 500 tumbles below key technical level set in February as stock-market slide accelerates
https://www.marketwatch.com/story/sp-500-tumbles-below-key-technical-level-set-in-february-as-stock-market-slide-accelerates-2018-12-17
I don't tend to track the S&P 500 too much...I focus more on the DJIA. And the Dow is now barely above the lowest lows set in early February and again in early April.
The S&P 500 index late Monday traded below its lows hit back in early February as a broad-based sell-off in the equity market gathered steam ahead of a key Federal Reserve meeting. The S&P 500 SPX, -2.08% was down 2.539.06, down 2.4%. If the broad-benchmark held current levels it would fall below its nadir in 2018 set on Feb. 8 when it closed at 2,581. All 11 sectors of the index were trading lower, led by declines of at least 3% in real estate and utilities. Market technicians view a decline below a recent low as a bearish sign for a market but it could also signal that the index is close to putting in a bottom.
Either a bottom here or we break through to the low side and hang on for dear life. I know which way I'm betting on. Hopefully the bulls will hold off the bears long enough for one more up and down cycle so that we can push our chips in at the appropriate time. Sure hope Schwab doesn't dawdle on approving that options trading application.
DJIA just blew through my lower trendline...there are probably a gazillion computerized trading programs out there that control huge sums of money that might trigger a massive selloff at around that 23350 level that was established between the double tops that formed in January & October.
I think I'm starting to know what the passengers on the Titanic musta felt like when they suddenly realized..."God Almighty, I think we're going down!".
Cmon, baby...please hold for 1 more up and down cycle so we can don some lifejackets and climb into a little boat.
Not looking too good here, John. I think I've made it abundantly clear by now what I think lies ahead for the broader markets and if they do what I think they're gonna I can't see how it could possibly be a good 2019 for the pot sector.
I spent much of the weekend changing gears and working up some options strategies to protect my Dad's account from a market plunge and maybe even profit handsomely from it. He just mailed in his application form today for approval to buy and sell options in his IRA account and hopefully Schwab will rubber stamp his app in time so that I can get him set up before the looming crash.
As of this moment the DJIA is hovering around 23640 or so...less than 300 points above the supercritical support level of 23350 or thereabouts. That has got to hold...or else. The TA chart I worked up last week now shows us right on the lower trendline that I drew...hopefully that holds and the market goes back up one more time around the holidays before the bottom falls out so I'll have a chance to dump some of his funds and stocks and sell some covered calls on others and buy some protective and speculative puts. Not sure if I will get the chance but keeping my fingers crossed that it isn't already too late.
Confucius say: "If person can't make money in pots then make it in puts."
Best of luck, amigo...methinks anybody who is long in damn near anything is gonna need it soon. Looking to me like mid to late January if we can hold here and even sooner if we can't.
Okay, thanks. I just compared the 2 ETFs on the same chart...% return over time. They track each other damn near perfectly, but your MJ fund generally yields better returns...
September 4th to present (the day we bought our first pot stock):
MJ: -22.1%
HMMJ: -31.6%
YTD:
MJ: -28.0%
HMMJ: -36.5%
You can see that while MJ does better than HMMJ its performance ain't exactly anything to write home about either.
These miserable returns may show what I have suspected...that it might be a lot better to swing trade these MJ stocks rather than hang onto them long-term and always have constant exposure no matter what.
Think I'll just keep on doing what I've been doing all along, and if I start performing as poorly as these guys I'll just quit trading altogether and find a new hobby. Maybe I'll take up throwing darts...it appears to be what these fund managers have been playing.
Why ain't Sproutley on that list??? LOL
Hey, John...my old man wants to give me even more of his money to play around with...guess he ain't too happy with how his Schwab & Gabelli funds have been performing. So I'm trying to gauge how I've been doing before I agree to take on the extra responsibility.
I took a look at the Horizons MJ ETF (biggest pot ETF in the world) so I could compare myself to something. Our first pot trade started on September 4th...if we had just put everything into this "professionally managed" ETF we'd be down a whopping 32% right now!
https://www.marketwatch.com/investing/fund/hmlsf
Now I am certainly no financial whiz or the sharpest swing trader in the world by any means, but we are still up double digits since I started even after a rough few weeks lately. I am not very impressed by how this ETF is performing at all. You ever trade these things or do you just stick to individual stocks yourself like I've been doing so far?
This ETF better get some new fund managers if a clueless newbie like me can beat them.
You know, last week when Vic said to expect an Aphria "line-by-line" rebuttal "by likely Wednesday" he also said at the same time that Liberty would "likely" be responding to QCM/Hindenburg's second report by Monday.
Neufeld said Liberty Health Sciences, a company backed by Aphria that was the target of a second round of allegations, will likely release its own response on Monday.
That hasn't materialized either. To my knowledge this is Liberty's only "response" to date...
https://www.marketwatch.com/story/stock-investors-you-have-now-been-warned-for-the-last-time-2018-12-14?mod=MW_story_top_stories
Lost all your money in the market? Don't worry...smoke dope...be happy!
See? If Vic had hired you and me that PowerPoint rebuttal woulda been out days ago and this dark cloud wouldn't still be looming over his head.
What should we tackle next...Facebook's public relations nightmare? Nawww, let Zuckerberg twist in the wind for a while. I don't much care for that dude.
I was wondering the exact same thing. Maybe Vic figures that investors often have the attention span of a walnut and just hopes they'll all forget about it.
Hey, if you think Aphria has a PR problem check this out...
https://www.marketwatch.com/story/johnson-johnson-stock-slammed-by-report-it-knew-of-asbestos-in-baby-powder-2018-12-14
See, if I worked for J&J I would just put out a press release saying "we put that asbestos in our powder on purpose because we didn't want your baby to catch on fire!".
I like to sprinkle a little Soma over my Soylent Green in the morning...the breakfast of champions.
I'm not a big fan of these long parrots always squawking "BUY!" but here ya go, gang...
https://investorplace.com/2018/12/best-stocks-for-2019-charlottes-web-cwbhf-stock-marijuana-stock-to-watch/
No thanks on daytrading...way too hectic and stressful for me.
"A man's got to know his limitations." --Clint Eastwood
Well, in your defense OBA your recent swing trade on Aphria was a possible dead cat bounce and those are always a lot tougher to decide when to sell because you never know how high it's gonna bounce before it resumes its downslide. But you still ended up doing just fine, IMO.
It's quite a bit easier to swing a stock that has been rangebound for a while and trading sideways with some fairly well-defined upper and lower resistance & support levels that have already been hit several times. That's what many/most of these pot stocks were doing from mid-September to mid-October between the time the stocks rocketed up after the Canopy-Constellation deal and the subsequent crash. We did very well during this period even though the stocks themselves weren't doing much overall and it would suit me just fine if the sector just returned to that kinda predictable behavior.
But don't get me wrong...if these MJ stocks decided to double or triple like they did for you guys and we missed most of because we weren't into them yet I sure wouldn't complain none! That musta been really sweet for you folks who have been involved in marijuana sector investing/speculating longer than we have.
I know what you mean...we had 6 positions open in mid-October and I didn't like having so much action going on all at once. Luckily for us my inner bear kicked in and we dumped 4 of them just a day or two before the sector crashed so we escaped potential disaster in fairly good shape.
Hey, mx...I once worked on a missile named after you...
https://tinyurl.com/MX-Missile
Thank God this thing never got used in real life...otherwise none of us would be here now worrying about buying or selling anything.
I'm not a very greedy person by nature so I usually have no problem selling into strength if a stock gets close to my original price or % gain target. I'll usually leave some money on the table because I tend to sell early rather than wait for it to top off and start coming back down again.
But I understand the FOMO challenge...I've been swinging these pot stocks for my elderly father's account and sometimes I really have to convince him to sell when we have a nice gainer...he often thinks this or that stock is headed for the moon.
We lost out on a great chance to take a nice quick 15% gainer with Charlotte's Web after only a few days because he putzed around and waited. Oh, well...it's HIS money, after all! But I woulda thought by now after seeing so many stocks drop big after we sold that he would be a little quicker with the sell trigger but basic human nature is tough to overcome sometimes.
I think it really helps to be a contrarian if you're gonna swing trade, and since I am a bear at heart every time I see one of our stocks shoot up I'm convinced it's about ready to plunge so maybe that's why I can sell more easily than others.
LOL...not very hard to trick an engineer. We do all the work and the managers get all the money.
These pot stocks sure are acting crazy early this morning...huge dip and rebound in Aphria and some others I've looked at. A daytrader's dream if a person is into that kinda stuff.
Looks like it might be one of them roller-coaster Fridays to end the week.
It ain't just the Fed, John...not by a long shot. We're facing a multitude of problems right now...political, social, economic, global...and I don't see anything being done to address them. If anything, they're only growing worse.
But I'm a pessimistic bear by nature, so maybe that has something to do with my outlook.
I'm not as optimistic about the future long-term prospects for many/most of these pot stocks as you are, twist...but I'd much rather you turn out to be right than me.
Okay, I'll take a crack at future prediction...not with precious metals but with the DJIA.
Probably two more up and down cycles from here...Dow's been in a descending wedge since the second of a double top formed in early October (first one came in late January). We're not quite halfway up the wedge at the moment...should bounce off the upper trendline a little before or after Christmas (25400ish) and start heading back down but will still be higher than we are now so at least the blue chippers will have a nice holiday if not us lowly potters. Then back down toward the lower trendline to a lower low than we just were on Monday (23881) but still above the critical support level formed between the two double tops. Back up and down one more time after that and on that next low we finally break through that crucial 23350 support level and we will have just witnessed the birth of a new baby bear...mid to late January 2019.
Bonus prediction: Trump will blame it all on Pelosi.
Approx. 3/4 of these pot companies are going to fail
Only 3/4? You're an optimist, I see! Bet it's more than that 5 years from now. Since I now owe you 10 shares of Radio Shack stock after your Blackhawks beat my Penguins last night we'll go double or nothing.
See that sleeping bear in my ID? He just woke up...
https://www.marketwatch.com/story/heres-more-evidence-that-stocks-are-now-facing-a-bear-market-2018-12-13
Yep, I'm still fairly new to this short-term swing trading stuff but already know what you mean. Having a good plan but not sticking to it sometimes ain't a whole lot better than going in with a bad plan in the first place.
I've managed to mostly avoid the latter so far but the former is still a work in progress. Still positive gains after 3-plus months which includes the sector crashing in October so it coulda been a whole lot worse, I suppose. Not doing it so much for the money like you are...more just for the fun and challenge of it while learning new things. When it stops being fun it's probably time to look for a new hobby. That day may come soon if this sector doesn't turn around in the near future...LOL. Better to quit while you're ahead is an old saying that I've heard once or twice before.
To be perfectly honest if online poker was still legal I'd probably be doing that instead. Made more money with a lot less effort.
I was watching your trade develop. When I saw you had averaged down I was thinking "hooboy, this might not go all that well for OBA". I did some research and found out that down gaps don't fill nearly as often as many people think...I believe it was only around 20% of the time or maybe even only 10% of the time, I forgot exactly. And the bigger the gap and the longer it takes to fill the more those odds go down. This was for a standard deviation move of 1 which is about what Aphria's first down gap was...the second one a day later was a little smaller.
And those were gaps caused by normal chit like earnings misses and regular stuff...not potential corruption and fraud. I almost posted a couple links to you with the statistical research and then I figured "hell, this guy knows 10 times more than you do and knows what he's doing". Glad it worked out for you.
Anyway, start making some room on that mantle for the December award that's headed your way. You deserve it IMO.
LOL...I started looking into them after you mentioned it. I saw they just hired some big exec from Anheuser-Busch which is good.
And I kid you not...the very first piece of DD that I did after you posted them to me is googled "DeFrancesco & Sproutly". Found zero connection which is even better!
I just nominated you for the Swing Trade of the Month Contest.
But if you had sold at around $6.50 a few days ago I woulda built a shrine in your honor. Getting that second down gap filled was pretty good but hoping to get the first one also filled was a bit of a stretch.
Regardless, nicely done and congrats.
Agreed. But on its way to becoming less overpriced.
But that's okay...IMO the broader markets are gonna totally tank sometime in late January if not sooner. We MJ investors/speculators are just a little ahead of the curve, is all. Probably good practice for what likely lies ahead for "saner" investors. When they start whining that they're down 30% we can all say "Big deal. Is that all???".
This MJ sector is so weak right now that nothing is juicing it. When the broader markets go up big, no help. When Cronos strikes a big deal with Altria, no help. When Congress passes the Farm Bill legalizing hemp, no help. When Vic issues a slam-dunk rebuttal refuting QCM, no help. Oh wait, forget the last one...that never happened.
I may have to stop swing trading these pot stocks for a while because this ain't cutting it. Might have to move into the computer chip makers...but first I need to check and make sure that DeFrancesco hasn't RTOed some shell into a bogus CPU company.
Hey, John...remember last weekend I told you that I thought the MJ sector might end this week down ~5%?
https://www.marketwatch.com/investing/fund/hmlsf
Closed last week @ $12.4837...currently at $11.84...down 5.2%. Looking like a pretty good guess right now, huh?
Might even end up lower than that with A-hole Andy's Aphria Anchor dragging everybody else down.
I've been deepdiving into this DeFrancesco dude ever since the short report hit last week. What I'm really starting to think is that when he started Aphria he fully intended it to be just another scam company just like all his others have been...do an RTO (reverse takeover or reverse merger that avoids the scrutiny of a normal IPO) using a shell company that has nothing whatsoever to do with the new company being created, build up some shareholder capital and then start sucking it out leaving them high and dry. He did it with his sham energy companies and he did it with his sham mining companies...interestingly all focused on Colombia...he sure does like that country for some reason. And in between his energy/mining scams circa 2010 and his intended marijuana scams starting with Aphria followed up by RTOs that created Liberty & Scythian/SOL he occupied himself by ripping off investors with his good and equally crooked Honig buddy in other endeavors.
But a funny thing happened before he could pull his standard Dracula MO...Aphria grew and grew and all of a sudden DeFCon 1 found himself sitting on a gold mine with a market cap of billions of bucks...oh yeah, Andy sure hit the jackpot on this one. Not sure why this happened...maybe Neufeld didn't know Aphria was never intended to be a legit company in the first place and he really is a good and honest CEO who tried to build something real and tangible. Or more likely it was plain dumb blind luck going public at just the right time when investors/speculators had started throwing their money around willy-nilly at every fledgling pot startup reminiscent of the dot-com boom days of the 90s that a lot of my work buddies lost a lot of money on.
All I know is what I've seen over and over and over again...every single company this DeFCon 1 dude ever founded or was heavily involved with one way or another has price charts that eventually end up looking like trainwrecks as they asymptotically approach zero.
I don't know if Neufeld is just as crooked and corrupt or is simply a naive CEO who got taken in or was blackmailed into shoveling DeFCon 1 tons of investor money under the table but either way this probably ain't gonna end well. It never has yet for anybody who's trusted DeFrancesco to be an honest capitalist and bet a few bucks on him...at least those who didn't get out in time before the crap hit the fan.
There's always the chance that this "analysis" of mine it totally FOS and Vic & Gang still have time to save this badly-listing if not sinking ship but they're rapidly running out of it. It may be that Aphria's only hope now for survival is to totally clean house of all the termites and hope that "this rot runs deep" that QCM spoke of is not yet so deep that the entire house has to be condemned and torn down.
I always figured something like this would eventually happen in this Wild Wild West environment that is the burgeoning marijuana industry with so much money being hurled around but you don't usually figure it will happen to the 3rd largest cannabis company in the entire sector. Sometimes bigger ain't always better. I found that out firsthand the hard way with a company called WorldCom.
“You will find all of the 20-some allegations, line-by-line, point-by-point with pictures — real pictures, truthful pictures — on what we have called LATAM asset acquisition,” Neufeld told the Star on Friday. “Every point will be very informative and will shed the real light on the story.” He said that rebuttal will likely be released Wednesday.
Well, in Neufeld's defense he didn't say WHICH Wednesday.
This kinda reminds me of early in my career when we were years behind schedule getting the first Space Shuttle launched and still fighting tons of technical issues...and some NASA weenie comes outta nowhere and claims "We WILL launch in March!". Within days calendars started appearing all over the place with his quote on it and every single month was labeled March. A little nerd humor that we all howled over...okay, so maybe you had to be there.
https://www.csmonitor.com/1981/0114/011437.html
Maybe all the calendars in the Aphria offices now say every day is Wednesday???
Haywood analyst Neal Gilmer APHA TARGET $17.00 says he does not believe the report is accurate in its entirety.
These long-side BUY! parrots are every bit as disgusting as short sellers, except nobody squawks about them when they try to manipulate the market. And there are a whole lot more of them than there are QCMs and Citrons.
Doesn't matter if Grego's report is only half right...that would be plenty bad enough. If some perv gets accused of molesting 50 kids but "only" gets convicted of abusing 25 that doesn't mean the dude is a good guy you should hire as a babysitter.
Vic and his boys have had over 10 full days now to come up with a credible rebuttal while his loyal shareholders have been whipsawed back and forth and the rest of the MJ sector is watching and waiting and wondering. 10 days, Vic...Apollo 11 went to the Moon, landed on it and returned back to Earth in only 8. This ain't rocket science...he delays his response into next week and we may have to take Aphria straight to DeFCon 1 (DeFrancesco Conjob).
Remember, this is some of my elderly father's speculation money I'm playing around with here. I don't want him to be doing these dangerous MJ stocks on his own...he'd probably get killed. He's always been a long-term investor buying high-dividend stocks and safer annuities...not super volatile pot stocks that go up or down 10% or more in a single day. He doesn't have any experience flipping stocks in just a few days or weeks...don't want him chasing a stock higher when they skyrocket and then dumping when they dive. That's just the opposite of what a person should be doing.
We've traded quite a few pot stocks over the last 3-plus months and this is the very first and only time we've ever had any problems whatsoever. Don't think he'll want to open up another account just so we can swing Charlotte.
I just hit my limit on posts today so good luck, amigo.
Today is a good example of why it's a total PITA that Schwab customers can't trade this stock quickly online. I mighta let CW go earlier today for a 15-20% gainer. That is a really good return for just 2 days...especially in this bearish mood the markets are in right now.
I was doing that a lot from mid-September thru mid-October when the pot sector was pretty much trading sideways and those kinds of winners can build up quite nicely fairly quickly.
I'm not sending a Christmas card to Charlie Schwab this year.
LOL...no way, John. I was just curious if you saw any spikes on the minute or hourly charts is all. Don't go messing around with experimenting in real life. Not worth fooling with it.
Not much of a reaction so far to the Farm Bill...
https://www.marketwatch.com/story/cannabis-sector-mostly-lower-as-investors-shrug-off-senate-vote-to-legalize-commercial-hemp-2018-12-12
Wasn't really expecting a super big bounce. Hopefully we'll just slowly slog our way upward over time. Some of my swing trades have taken up to a month to pay off so I don't need it to all happen in just a few days. Sometimes you just gotta be a little more patient than greedy.