We’re dipping into the Cannabis stocks because the sector went wild last night.
And today’s Fast Profits Friday trade is on Canopy Growth Corp. (CGC), one of the most likely to benefit from a sector boom.
Here is the action to take from this morning’s show…
Normally, I expect to hold Fast Profit Friday trades for around four to six weeks, but this one is special.
I’m looking at CGC to be a bit of a “mover and shaker” up to the $9 or $10 level.
If you aren’t out in 10 days at the $2.20 target, I recommended making an exit.
Also, if the stock reaches $10 I’d say take whatever you can at that point as well.
Here’s my “weather” forecast on this one…
CGC is likely to crest the top Bollinger Band and then see the real volume flowing in over the next few days.
It could grab an even nicer bounce depending on upcoming Capitol Hill action.
Given the political landscape, I don’t think we can expect national legalization anytime soon.
But with so many states bringing their own bills forward this year, the tide is certainly moving in that direction.
Even Big Pharma and Chelsea Clinton are starting to dip their toes in the cannabis Kool-Aid, which says a lot about where we’re going.
With all that said, this is both a headline AND a technical-driven trade.
Some of our best winners tend to check both boxes, which is why I recommended it today.
Why Is Cannabis Getting My Attention?
You all know I trade the technicals, and if they weren’t giving me the signal, I’d ignore all these news reports.
In the end of February into March, you saw a lot of bullish activity in the cannabis sector, but they rolled back over quickly.
Then you’ve got Alternative Harvest ETF (MJ) bottoming out around $8 before making a turn to the upside.
That’s right – despite earlier signals to stay away, MJ broke above its 50-day moving average this week.
That rocketed it right onto our target watchlist yet again.
And then we look at the underlying asset for today’s trade, Canopy Growth Corp (CGC).
Yesterday, it broke above its own 50-day moving average, signaling to us that it is time to take action.
Look how many states are starting to move toward legalization.
The best way I could put it is as follows… slingshot ENGAGED!
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Wishing you all the best trading success and a pleasant weekend.
Quantitative Specialist, Penny Hawk
P.S. In case you missed it, I wanted to recap what a REAL short squeeze looks like. They can provide great opportunities if you know what you are doing. Check out my full commentary by clicking here.
March 25 2022