Canadian CANNAINVESTOR Magazine August / September 2017 - Page 175

Wrap it Up

As always, I appreciate any commentary and or questions having to do with technical analysis and would appreciate feedback if one has it (negative or positive). I am reachable on twitter @dyro01676 and occasionally on setyourstop.ca as a contributor there as well. I will end this month’s article by pointing to the series of higher highs and higher lows that have been observed on the Cannabis ETF HMMJ.to. This is a good sign and if this trend continues, traders should look to buy the dips and sell the pops. You gotta love an uptrend in Cannabis stocks!

165

Aphria Inc. (TSX:APH)

Fast forward to a month after the company received their official “license to sell” and we can see that my “crowd trade” observation turned out to be correct. There were no new additional buyers and instead a plethora of people who were looking to sell the news. Shareholders of supreme saw their stock briefly jump on the news but if you didn’t sell that pop (which did not last long) and held up until now, you saw about a 20% reduction in the amount your Supreme shares are worth. This is just something to keep in mind of going forward, and I can’t lie I got the idea of the psychology of “crowd trades” from my favourite trading book “What I learned Losing a Million Dollars” (I highly recommend this book if you are serious about trading).

The Supreme weekly looks as if it’s bounced off of support for now, but as you can see, no significant downtrend has been broken to the upside yet. RSI is still in a downtrend and the MACD has yet to show any positive divergence since 2016 (hard to believe).