ETFMG Alternative Harvest ETF (MJ)

[sweet crude]

MJ upgraded from being oversold (read)

Cannabis Stocks Get Upgrade At Oversold Levels

(NEW YORK) – CBD sector gets upgrade as Mitch McConnell pushes FDA to establish regulatory rules for CBD products, which could provide catalyst for major short covering event in an already oversold sector.

In September, Senate Majority Leader Mitch McConnell (R-KY) inserted language into congressional spending report that called on the Food and Drug Administration (FDA) to clear a path for the lawful marketing of CBD products.

The FDA has said that allowing CBD to be sold as food items or dietary supplements would require it to develop alternative regulations that could take years to complete without congressional action, and this has taken a toll of the entire CBD sector over the past several months.

But McConnell, who was the chief proponent of a hemp legalization provision of the 2018 Farm Bill, isn’t interested in waiting around. Senator McConnell is asking FDA to “issue a policy of enforcement discretion with regard to certain products containing CBD” before the end of the year.

Another group of senators is also calling on the FDA to expediently implement regulations for CBD in order to protect consumers and free up the industry.

At a press conference on Tuesday, Sen. Richard Blumenthal (D-CT) said he is urging FDA to issue guidance so that CBD products can be lawfully marketed. He and five of his colleagues also sent a letter to FDA expressing their desire to speed up the rulemaking process.

With all this pressure from Congress there can be no doubt we could see some positive framework released before end of the eyar, which could send the entire CBD and cannabis sector rallying.

Sector Highly Oversold

If you take a look at ETFMG Alternative Harvest (NYSE: MJ), which is an ETF that tracks the cannabis and CBD stocks, you can see the sector has been taking a beating since mid-summer as fear of FDA crackdown started to build.

But maybe things are oversold now and due for a major bounce.

The RSI on MJ is trading well below 30, which indicates this sector may be highly oversold at tehse levels. The MACD indicator also seems to be trading flat, which may indicate a bottom is starting to form in MJ just below $20 mark.

Could MJ and cannabis sector continue down further? Sure, absolutely! But as a whole everyone who wanted out of this sector has all but sold out by now, and this usually indicates a great buy signal for contrarion traders who like to buy into downside fear.

Compared to where it was during its high flying days in 2017 and 2018 this sector looks highly oversold, but this could also signal this sector is due for a major bounce.

CBD Sector Gets Upgraded

To this point, Ludlow Research issued note to its subscribers that some CBD stocks were down nearly 50-70% from their recent highs, and any bullish change to regulatory environment could trigger short covering within the sector as a whole.

The research firm stated, “Not all CBD companies may be able to comply and survive these new regulatory changes coming, but the ones who can now offer real big upside potential after months long correction within the sector”

View sector upgrade alert here https://ludlowresearch.com/reports

Play on New FDA Rules

MetWood (OTC:MTWD) is a recent merger that brings public a health supplement manufacturer with FDA register production facilities. MTWD provides companies FDA registered production and labeling solutions for healthcare and consumer supplement products. The services MTWD offers could be some of the exact requirements the FDA may ask of CBD companies, thus making MTWD an unique play to win on pending FDA regulations for CBD sector.

ChineseInvestors (OTC:CIIX) produces a line a CBD based cosmetics, which is all but exempt from FDA pressure. The company revenues continue to rise, and with their focus remaining on CBD cosmetics this play could be worth a pop down in the $0.30 range.

CBD Stocks Placed on Watch

CVSI CV Sciences
KGKG Kona Gold Solutions
NBEV New Age Beverages
HIPH American Premium Water
CIIX Chineseinvestors.com
MCOA Marijuana Company of America
SWRM AppSwarm
BKIT Biohemp International
RMHB Rocky Mountain High Brands
RLBD Real Brands

https://wallstreetnewscast.com/cannabis-1010/