A buy alert for United Cannabis was sent out this morning at 10.00 am EST which read…
“United Cannabis is believed to be powering up for the sort of rocket move we have just seen in General Cannabis. We traded out of this one a little while ago (Email alert) to sidestep a reaction – it did react but then turned up and advanced again in a measured manner, measured because it is battling through a zone of resistance and gathering itself to take out its falling 200-day moving average. Persistent strong upside volume is driving volume indicators sharply higher, and suggests that once it gets above its 200-day moving average it will advance swiftly to make big gains. So it is rated an immediate strong buy. Current chart has been saved and a report will be posted later.
United Cannabis, CNAB on OTC, trading at $0.941 at 9.41 am EST.”
Since this alert was sent out it has made an aggressive assault on its falling 200-day moving average on what will be the highest volume since its peak last February. So far it has failed to get above it, and is up 4.3% but looks set to achieve this soon. We can see the resistance it is battling to overcome and the further resistance at its falling 200-day moving average to advantage on its 6-month chart below, which is for the time the alert was sent out. We can also see the strong upside volume which promises to break the price clear above all this resistance in due course.
It’s also useful for us to step back and take a look at the long-term 5-year chart, which shows that United Cannabis has marked out – and is believed to have completed – a fine large Pan & Handle base, which has a classic volume signature. The huge volume on the sharp rally to complete the right side of the Pan part of it signals the market’s realization that the company has turned the corner and is on the up. This gets overdone as usual, leading to a lengthy hangover, which is the Handle part of the pattern, that allows time for the fundamentals to catch up. Once they have, which is believed to have happened now, the market suddenly gets wind of it and another powerful rally starts, a so-called “breakout drive”, that vaults the price out of the entire base pattern leading to a powerful bullmarket uptrend resulting in big gains. That is what has just started to happen over the past month with the rally of recent weeks being driven by persistent strong volume, and a fine example of what it can lead to is the spectacular runup in General Cannabis (CANN) that
we bought some weeks back.
So, United Cannabis is looking like a very attractive play here, and rated a strong buy as in this morning’s Email alert. The company has 60 million shares in issue.
United Cannabis
website
United Cannabis Corp, CNAB on OTC, trading at $0.95 at 2.29 pm EST on 12th December 17. Recommended at $0.94 at 9.31 am EST.
Posted at 2.45 pm EST on 12th December 17.