Marijuana/Pot Stock Analysis 10/3/16. Things are heating up!!! TRTC, ERBB, VAPE, CVSI, MSRT, SRNA, AMMJ, KSHB, GRNH

Today was an exciting day in penny land. The sector was up 11% but for many of us, we saw our holdings up 20%+. A sign of a market pump is when even the "laggards" start to catch up. Today that was true for erbb (up  133.33% ) and vape (whose CEO resigned under strange circumstances, up almost 37%). However, many of the more legitimate companies have been slowly creeping up for awhile now, and had great gains today too.

Before I get to the specific companies I like for the upcoming election catalyst (and I think you should get in asap before things really heat up) let's take a quick look at the marijuana/pot stock sector from its glorious pump in 2014 to the soul crushing lows of recent.

As you can see the sector is down more than 90% from the 2014 pump... ouch. Mr market likes to punish those that get ahead of themselves, but thats for another post.

But from the wreckage, a few good companies have emerged. And I think the sector is due for a rally to reclaim some of those lost gains. I do not think we will see a repeat for 2014, but I can see the sector going up 10x from current levels. The important thing is to build a solid foundation of legitimate companies who in theory, should benefit the most from a sector wide pump. We want companies with real business contracts, good revenues with revenue increases Quarter over Quarter, improving gross margins, and very importantly, we look at the board members and upper management. This will tell you a lot about the company. Is the CEO associated with other pump and dumps? Or does he have a Medical degree from Harvard? I cannot stress this enough, a competent board and upper management are crucial.

Anyway, I plan on doing a stock by stock individual analysis in future blog posts, but here are the companies I like for the upcoming pot stock pump for reasons I listed above. My general trading advice is this: Buy on a day the stock is down and ALWAYS use limit orders. 

Companies I like: CVSI, TRTC, SRNA, MSRT, AMMJ, GRNH

Maybe list: CBIS

Turds: ERBB, VAPE, FITX, FBEC, VPOR