It’s hard to tell when a stock is at the end of a strong run, or if the broader market is running out of steam.
But one thing to look for is how stocks react to bad news.
The more sensitive the stocks are to the bad news, the closer we are to the end of a recent rally and possibly going into a bear market.
On the other hand, if negative news has little effect, then the stocks still have room to run higher.
One particular group of stocks went through this just the other week.
There was an announcement that had the potential to put companies out of business, yet, despite an initial negative reaction in the stocks, shares have rebounded and held steady.
This is one industry that I honestly haven’t followed that much yet, as it is somewhat out of my wheelhouse. But the way the group as a whole reacted to the news recently has convinced me it is here to stay, and if you don’t have exposure to it yet — now is the time.
Marijuana Stocks: A Movement
The industry is marijuana stocks.
And I know, a lot of people have avoided these stocks because, well, let’s face it — it’s a drug that is illegal in most states.
That’s the same reason I haven’t followed it much. I’m not really a fan of the movement.
But after I saw how marijuana stocks reacted, it has me convinced the movement is here to stay, and apparently, more people in general are jumping on the bandwagon.
Now that the majority of people seem to be in favor of legalizing marijuana, aka cannabis, the movement may be here to stay.
That’s why a recent announcement that shook the industry was so important — I wanted to see how the stocks reacted.
U.S. Attorney General Jeff Sessions announced plans to roll back federal policies that paved the way for states to legalize marijuana — the policies that have allowed marijuana stocks to flourish and raised expectations for recreational marijuana to be allowed in more states.
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