HEXO Corp (HEXO)

[CornellEngineer]

HYYDF was our first swing trade so I kinda have a soft spot for ol' HEXO...they say you never forget your first.

But one thing that is a little scary (okay, make that WAY scary) about the massive rise in valuation that many/most of these pot stocks experienced between mid-August and early September is that they went up so far and so fast that there never really was any time to build any meaningful support levels. There was practically no pause or pullback during this meteoric rise...no time to consolidate at various levels along the way while these stocks were doubling and even tripling in just a few weeks. And that's why we sold off our HEXO in early October for a hefty gain after holding for a month...because I figured that if it broke down from the levels it was at there was no telling how far it could drop. And right now I'm sorry to say that HYYDF's chart kinda looks badly broken to me. If you or anybody else can look at its chart and make out any solid support level I'd love to hear it because quite honestly I don't have a clue myself.

I'm not exactly sure why HEXO in particular took it on the chin so bad on Friday...it was pretty much a bad day all around for MJ stocks in general but last week as a whole was positively brutal for HYYDF as it dropped almost 23% from Monday's open to Friday's close and is down nearly 30% from its all-time high set on Tuesday. I even checked to see if all of their greenhouses had maybe burned down or something but couldn't find any relevant news about them to explain this sudden plummet.

HEXO is still one of my favorite stocks as far as the bigger cap Canadian pot stocks are concerned and we went a little long again during this carnage although not as big a position as before. I believe HEXO is undervalued relative to many of the other MJ equities but compared to "normal" (or should that be NORML?) stocks it is still very much overvalued, so this kind of a harsh correction is always possible and should be expected to occur from time to time. If this latest move surprised anybody then they probably shouldn't be putting any money into this sector in the first place because quite frankly this kind of drop could happen to any of them at any time.

What remains to be seen at this stage is whether HEXO will rebound some next week (or at the very least stabilize for a while at these current levels) after this massive selloff or whether it was just a harbinger of things to come for the rest of the high-flying marijuana sector and our dear HEXO just happened to be chosen to lead the way.

HEXO wants to be a market leader but I seriously doubt this is what they had in mind!