There is more optimism in marijuana stocks after an ingenious deal was revealed. (I will explain that later.)

After I wrote “How to potentially become a marijuana millionaire, albeit carefully,” a lot of money has been made in marijuana stocks by following segmented money flows. At The Arora Report, we use that method, which provides X-rays of marijuana stocks. Let’s examine the latest money flows in marijuana stocks after this ingenious deal.


Please click here for a chart showing segmented money flows in 17 popular marijuana stocks. Please note the following:

• At the federal level, marijuana is illegal in the U.S. Companies that touch the marijuana plant have difficulty listing their stocks on a major U.S. exchange, so many list their shares in Canada.

• Canopy Growth CGC,  is a Canadian company that’s listed in the United States. Canopy Growth was looking for a way to maintain its stock listing in the United States but at the same time participate in the growth of marijuana in the United States. Canopy came up with an ingenious way to acquire the rights to buy Acreage Holdings ACRGF,  Acreage Holdings is a multi-state marijuana operator in the United States.

• Due to this arrangement, Canopy Growth can keep its stock listed in the United States and participate in the growth of marijuana in the United States at the same time.

• This is like having your cake and eating it too.

• The deal has generated a new wave of optimism. In our analysis at The Arora Report, if this deal had not happened, marijuana stocks would have likely fallen 20% to 30%.

• Now let’s do an X-ray of Canopy Growth with segmented money flows. Smart money flows are neutral. Momo crowd money flows are positive. (Momo = momentum.) Short squeeze money flows are very positive.

• Before drawing a conclusion on Canopy Growth, let’s do an X-ray of Acreage Holdings. Both smart money and momo crowd flows are negative.

• The sum total of the two foregoing points is that the rise in Canopy Growth stock is being driven by the momo crowd and a short squeeze, but the smart money is cautious. One reason may be that the smart money bought Canopy Growth at lower levels and perceives high risk in buying it at this level.

• Note that the smart money is not selling Canopy Growth into the strength at this time.

• The chart shows that short squeeze flows are extremely positive in Cronos CRON and New Age Beverages NBEV.

• The chart shows that momo crowd money flows are extremely positive in Curaleaf CURLF.

• The chart shows that momo crowd money flows are positive in MedMen MMNFF, Liberty Health LHSIF,  Aphria APHA,  and Aurora Cannabis ACB.

• The chart shows that in Tilray TLRY,  smart money flows are negative but momo crowd money flows are extremely positive.

• The chart shows that in marijuana ETF MJ, smart money flows are negative, but momo crowd money flows are positive.

• Corbus Pharmaceuticals CRBP, is a small biotech company but is also grouped with marijuana stocks. Smart money flows are positive. This stock has come under a vicious short attack….Read more at MarketWatch.

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