With the benefit of hindsight we should have made more noise about General Cannabis, which was recommended on the site on 25th November, but rather tucked away in the article
20 Major Pot Stock Review. In this article it was written that if General Cannabis succeeded in breaking above its 200-day moving average, momentum traders would pile in and drive it quickly higher – and that is exactly what has happened as it has tripled in price since then, so any of you who did buy it should now be happy.
On the 6-month chart we can see the stellar runup of the past two to three weeks, but we can also see that it is now horribly overbought – supercritically overbought on its RSI indicator and extremely overbought on its MACD indicator, and in addition way ahead of its moving averages and also at resistance whose origins we will discover when we proceed to look at the 2-year chart. In short, it is like a guy who has just run straight up 15 flights of stairs. Even if we believe that it is destined to go much higher, which we do, it needs to stop for a breather here, and is expected either to react back some, or to enter a period of consolidation. That of course means that we should
TAKE PROFITS IMMEDIATELY and shunt the proceeds into something that is about to make its move.
The 2-year chart is most interesting as it shows that General Cannabis is a good performer technically – when it decides it’s going up it doesn’t mess around, it gets on with it. This chart is also very useful because it shows that yesterday it slammed into a clear target – the significant resistance at its 2016 highs, a big reason why we should take profits here and await developments. Whilst it is expected to bust through this resistance in due course and head much higher on the back of the massive sector bullmarket that is just starting to unfold, it is thought that it needs to take some time out here before it accomplishes this. Longtime subscribers may recall that we made an 8-fold gain in this stock last year, buying and selling it at the points shown on the chart.
So – what do we do with the released funds from the sale of this? Fortunately, that’s a simple question to answer – we go straight to the next cannabis stock that looks set to do what this has just done. United Cannabis (CNAB), which was written up on the site yesterday, is a fine candidate, and another one that we are going to look at right now here is American Cannabis (AMMJ), which was recommended on a minor dip (which occurred)
in the same article as General Cannabis towards the end of November, and
we also bought it at an even better price late in May and never sold it.
General Cannabis website
General Cannabis, CANN on OTC, closed at $4.91 on 12th December 17.
Posted at 6.50 am EST on 13th December 17.