Ask anyone about the hottest market sector of 2017 & 2018, and they’ll probably say crypto, right?
There’s always a hot sector. Before the crypto boom, we saw the action in shipping stocks, and then it was A.I. stocks that went wild — but what’s the hottest sector of 2019?
Download the key points of this post as PDF.
I’ll give you a hint: It’ll give you the munchies.
The year 2019 will be remembered as the year of pot stocks, and if you’re looking for the hottest in-play companies, you need to have a ton of marijuana stocks on your watchlist.
Let’s take a look at something you might not have heard of yet: Marijuana Penny Stocks.
Table of Contents
- 1 What Are Marijuana Penny Stocks?
- 2 How to Find the Best Marijuana Stocks
- 3 Key Tips for Choosing the Best Penny Pot Stocks
- 4 Trading Challenge
- 5 The Bottom Line
What Are Marijuana Penny Stocks?
Marijuana Penny Stocks are small companies in the red-hot legal marijuana industry. They may be pure weed industry plays, involved in growing the herb, or retailing to customers through dispensaries.
Check out this video I made on what to do when Canada legalizes marijuana. It might help you make more profitable trades**.**
Companies that are outside the pot industry could still be heavily involved in the weed boom by having ties to the industry. Think about transport companies that sign distribution contracts for the weed industry or manufacturing companies that are expanding into developing pipes to smoke pot.
With the industry being so hot, any mention of a company being involved with legal marijuana creates some crazy price moves, and there’s a lot of money to be made.
Just like any industry that’s red hot, there’s a lot of pump-and-dump action. Massive price moves upward will often end in collapse.
Maybe that sounds scary to an amateur, but to traders with the right level of skill, it often means simple, rapid profits.
The growth of the Marijuana Market
A lot of people are expecting marijuana to become a major industry within only a few years. That’s why the sector is so hot right now and why so many upstart companies are trying to grab a slice of the pie … or, in this case, the brownie.
Think of the soda market — imagine how much Coca-Cola, Pepsi, and Mountain Dew is sold everywhere, all over the world, at every minute of the day. The legal marijuana industry could surpass the soda industry, which could mean monster-sized opportunities for traders and investors.
The California Pot Stock Explosion
You can’t go past California when it comes to pot stocks. With the state having the fifth-largest economy in the world, and (let’s be honest) Californians being pot lovers in general, it’s considered the absolute holy grail of weed markets.
While medical marijuana has been legal in California for years, at the beginning of 2018, the state made recreational use legal as well. It’s now not much harder to buy weed than it is to purchase alcohol.
Think of all those cashed up baby boomers at retirement age, trying to relive the 1960s by smoking a joint or two after dinner, then think of all the gen X and Ys with their edibles and weed-vaping, and then think of all the people vacationing to California to enjoy the green herb. The market is HUGE.
The Country-Wide Potential in Canada for Pot Companies
Within weeks, Canada will make recreational pot smoking completely legal. This is the first country to legalize it on a national level, and it’s going to be an absolute gold mine of profits for pot companies ready to serve Canadians.
Nobody knows the exact size of the Canadian pot market just yet, but some analysts are expecting such a buying frenzy that pot will be sold out all over the country initially, with billions of dollars worth being sold in the first year alone.
This kind of frenzy could be extremely lucrative for a handful of marijuana penny stocks, so it pays to keep an eye on which companies are best set up to grab those Canadian weed dollars.
Benefits of Penny Pot Stocks
If you ask me what kinds of things you need to focus on to make the quickest stock market profits possible, I’d tell you to concentrate on two variables:
First, pick a sector that has massive growth potential, one with constant news stories causing huge moves in the sector’s stocks, and one that generally everyone’s excited about.
Second, find small companies that are primed to profit from the hot sector, where a flood of frenzied traders could come in any minute and push the prices up huge amounts.
That’s why, right now, you have to have at least one eye on marijuana penny stocks.
How to Find the Best Marijuana Stocks
I know what you’re looking for here. I’ve told you that marijuana penny stocks are hot, but how do you find potential targets?
First, focus on day trading. Penny pot stocks don’t hold their value over days, months, and years. Get in and get out with your profits.
Second, check out this strategy I’ve created to help find the best marijuana stocks …
1. Decide Which Marijuana Stocks to Grab Right Now
Unfortunately, I can’t tell you which marijuana penny stocks you should buy now. That’s your job. However, I can tell you what to look for.
Concentrate on volatility. If there’s no price action, there’s no profit potential. You want a spiky chart that shows predictable patterns between support and resistance.
You also want to look for high-volume penny pot stocks. If there are only 1,000 shares in play, there’s no reason to dive in. You might not be able to sell quickly, which means you can’t control your losses.
2. Use Technical Analysis and Chart Patterns to Find the Best Opportunities
Any stock trade you make should be based on careful research. Otherwise, you’re putting your cash at risk.
If you learn one thing from me, learn this: It’s all in the charts.
Any trade you make should be based off a high opportunity chart pattern, even if the stock has amazing fundamentals.
Now, if you know anything about technical analysis, you’ll know that there’s a million chart pattern and indicators, but trust me, forget 99% of them and just use simple, clean chart patterns.
With charts, simple is beautiful. You have a lot fewer headaches and have much greater odds of success.
But don’t overthink the charts!
Look for clean price action. It could mean a hot ticker is making clean higher highs and higher lows every few days, or it could be a stock with a recent exciting news story that’s just broken above its all-time high.
3. Fundamental Analysis for Penny Pot Stocks
As with all penny stocks, marijuana penny stocks generally don’t have the strongest fundamentals. They often have tiny operations, led by managers without the greatest reputations, and let’s be honest, most will blow up in the end.
You have to remember that penny stock movements are all about hype in general. Be on the right side of hype (whether bullish or bearish), and it should be an easy ride to profits.
Make sure to keep up to date with news and company announcements regarding earnings, contracts, financing and regulatory issues.
Be thorough in this and research everything you can, there’s a lot of information out there, but know this: The more you research, the greater your odds of success.
4. Only Trade Hot Stocks and Be Ready to Grab Your Profits
There’s no use buying or shorting a stock that has exciting fundamentals when nobody gives a damn about the company and the stock price isn’t going anywhere. If nobody notices the stock, you can’t profit from it.
Make sure to only be in stocks that are currently hot: people are talking about them; they’re in the news; the charts look clean and ready for big moves.
When you’re finally on a hot stock and you’ve made some healthy profits, don’t wait around too long. I can tell you from my 20+ years of experience: It’s much better to be too early getting off the train than too late.
With pot stocks being the hottest sector in 2018 and a bunch of these names being parabolic, you have to be aware that these crazy moves often end in major declines when the party’s over …
So, be nimble, ready to close your position, and walk away from the stock — and remember that hype doesn’t last forever.
5. Create a List of the Best Stocks
Your watchlist is a handy tool. Keep five or six stocks on your watchlist at all times so you can take immediate advantage of a potential win.
I also recommend maintaining a trading journal. Document failures and successes so you can avoid making the same mistakes twice.
6. Subscribe to TIMalerts
If you don’t have the time to build a watchlist and keep up to date on the hottest stocks each day, consider my TIMalerts service to help you save time and alert you to penny stock trades that are ready to make huge moves.
With TIMalerts, you’ll receive my daily watchlists showing you the exact stocks I’m looking at each day. We’ll send you real-time trade alerts, so you’ll know exactly when it’s time to get on board and ride the profit wave.
Key Tips for Choosing the Best Penny Pot Stocks
So you’ve got your broker account open? Your charting software and news feed ready to go? Here are a few tips on choosing prime marijuana penny stocks:
1. Look for Unicorns
In any booming market, the stocks you want to be involved in are just beginning to be discovered. Exciting news stories and rumors are beginning to pop up more regularly. Trading volume is picking up, and the charts are making clean higher highs and higher lows.
This excitement and price action creates a self-fulfilling prophecy, where everyone starts to jump on board, journalists notice and start to write more stories, and huge price moves happen.
The important thing is to get on board right before the stock takes off on a massive run, rather than looking back weeks, months or a year from now, wishing you’d gotten into the stock. Be aggressive and nimble!
2. Look for Canadian Pot Stocks
With the Canadian weed market so hot right now, many of the hottest pot stock performers over the next year will probably be those positioned to serve the huge Canadian demand.
Now, make sure to do your own research, but look for any information speaking about contracts regarding Canadian distribution, partnerships and any creative ways to tap into Canada. To give you an idea, some tickers to look at are TLRY, CGC, and CRON. Follow the breadcrumbs!
If you haven’t got the time to informed about which pot companies are ready to conquer Canada, consider checking out my TIMalerts service. You’ll receive my daily watchlists and learn what I think is hot right now.
3. Build Your Pot Stock Portfolio
Yeah, keeping on top of all the charts, news stories, SEC filings, and top percentage gainers and losers can be a chore, but it’s absolutely crucial to your success.
In the old days, I’d be clicking between 20 different websites, spreadsheets, and trading platforms just to keep up to date. Luckily those days are gone.
You can now use StocksToTrade to keep a watchlist of all your favorite stocks, filter for high impact new stories, scan for new trades and so much more.
It’s an all-in-one solution, my friends, that I helped create a couple years ago. It’s made our lives so much easier. It’s no coincidence that many of the world’s best penny stock traders start their day by loading up StocksToTrade.
4. Master Your Trading Skills
It’s no secret that the vast majority of traders lose. Sad, but there is good news.
The small percentage of traders that do make a profit take all the money from the others. That’s what can make trading so damn lucrative. Those with the right skills can make handsome profits**.
Falling into rank with the winners really isn’t that complicated. Hell, if I was able to do it as a kid, sneaking away to the high school library to research stocks, there’s no reason you can’t do it, too.
Now, I don’t want you to think you can just sit on your ass and wait for the money to roll in. This game requires hard work and dedication. It’s simple, but it’s not easy.
Get the right education (it’s much cheaper than college), study your ass off, and if you do as well as my top students, you could do quite well for yourself. After that, you can do whatever the fuck you want in life. Sound like a good plan?
I created my Trading Challenge to turn even absolute newbies into self-sufficient penny stock traders using every trick and tactic I’ve learned in over two decades in the markets.
If you apply and you’re accepted to come and train with me, you don’t just get tons of video lessons, interactive webinars, blog posts and more.
I’m also trading right alongside you. I use a small account when trading with my students so everyone in the Challenge can see how I run a small account up into real profits.
Apart from my charities, the thing in life that really excites me is training my students and trying to create my next batch of millionaires. Perhaps you could be one of them?
If you’re lazy, I can tell you right now, it’s not for you. But if you’ve decided right now is your time to make a bold move, then apply for my Trading Challenge today.
The Bottom Line
Marijuana Penny Stocks provide opportunities for some wild moves, and huge fortunes will be made and lost in the sector over the coming few years.
With any super-hot sector, you have to try and be on the right side of the hype and always be ready to close your position and hold on to your profits.
Like I always say, research the hell out of any stock you’re looking at and make sure your charts, newsfeeds, and watchlists are kept up to date constantly.
If you feel in over your head at all, don’t be afraid to reach out to me and get more training. I love teaching and am always here to help.
Who else is excited about the penny pot stock world? Anything you want to add? Comment below!