MSOS: Is the 50-Day Cycle Low In?

 

Today was an interesting day for MSOS for several reasons, and I want to walk through what I was watching and why I think it matters. As you know, just yesterday I wrote about the 50-day cycle that is expected to bottom this week. Going into today, I was already on alert for signs of that low coming in, and I have to say I saw some encouraging evidence both yesterday and again today.

On the left is a 30-minute chart of MSOS, and in the lower pane I’m comparing MSOS versus the SPY. The first thing that immediately stood out to me was how well the 3.95 level held. That area acted like a clear floor of support throughout the session. Every time price dipped into that zone, sellers couldn’t push it any lower. That alone was noteworthy, but what really caught my attention was what the broader market was doing at the same time.

While MSOS was holding firm at support, the SPY was making new intraday lows. Normally, you’d expect MSOS to crack if the market is selling off, but that didn’t happen. Instead, the ratio line in the lower pane began to rise, showing bullish divergence. That’s your first real clue that something has changed. When a stock or ETF refuses to go down while the market is making new lows, it usually means buyers are stepping in and quietly accumulating shares.

Another important detail was volume. The last 30 minutes of trading saw the heaviest volume we’ve seen in weeks. That’s not something I ignore. Heavy volume into the close, especially near support and after a prolonged decline, often signals institutional participation. In my opinion, that volume confirms what the relative strength was already hinting at: demand is starting to show up.

Based on all of this, I believe the 50-day cycle low that we were expecting this week may already be in. Now, nobody knows for sure what will happen next, and I’m the first to admit that. Markets don’t give guarantees. But if I’m right, I think we’ll see MSOS begin to trend higher over the coming weeks.

Looking at the daily chart on the right adds more context. We came very close to filling the gap, which often happens near important lows. Even more important, we broke the downtrend line drawn from the December high. That doesn’t automatically mean straight up from here, but it is a meaningful change in character.

Whether this turns out to be a major low or not remains to be seen. What matters most to me is risk management and protecting capital. At these levels, I believe the reward-to-risk is favorable, which is why I added yesterday and again today to the long position I’ve been holding for quite some time. Now we wait and let the market tell us the rest. Let’s see what happens.

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CGC: Is the Timing Finally Lining Up?

 

CGC… is it time? If you read my last post on MSOS, then you already know that the 50-day cycle is due this week. This is the same cycle I’ve been tracking and trading for a long time now, and when it kicks in, it rarely acts in isolation. Historically, it tends to lift the entire cannabis space, and CGC is no exception. Whether you love the company or hate it, this stock has a track record of moving hard when the timing lines up.

Just look at what CGC did at the last cyclical low back in November. From low to high, the stock doubled. Go back even further to last April and you’ll see a similar story, it doubled again. That’s not a coincidence, and it’s not something I’m ignoring. CGC may not always be a leader, but when the group catches a bid, it has a habit of responding in a big way. That’s exactly why I’m paying attention here.

From a technical standpoint, CGC is sitting in an interesting spot. The stock is currently at the bottom of an ascending channel that began back in March of last year. This channel has defined price action for nearly a year, and today it looks like CGC may finally be starting to bounce off that lower boundary. I’m not calling a confirmed bottom yet, but the location matters. When price is this stretched to the downside and lines up with a cyclical time window, my ears perk up.

What really caught my attention, though, is the ratio line of CGC versus MSOS. That ratio just broke above a downtrend line that has been in place since the spring of last year. Relative strength shifts like that often show up before price makes a meaningful move, not after. To me, that’s another piece of evidence suggesting that downside momentum may be fading and that CGC could be setting up for a turn.

Given that we’re now in the time window for a cyclical low and price is beginning to confirm the possibility of a bottom, I’m watching this very closely. I’m already long CGC, and I’ll be looking to add on a move over 1.20. That level would tell me that buyers are finally stepping in with some conviction.

Some of you may argue that CGC isn’t exactly the best cannabis company out there, and you may be right. But this trade isn’t about fundamentals, it’s about timing. When a rising tide comes in, it usually lifts all boats. If CGC does what it’s done in the past and doubles from here, I certainly won’t complain. From where I’m sitting, the risk-reward looks favorable.

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MSOS Returns to the 50-Day Cycle Window

 

Above is a daily chart of MSOS with its 50-day cycle, a cycle I’ve been writing about consistently for many months now. This isn’t something I just noticed last week or retroactively drew on a chart to make myself look smart. Back on December 6th, I openly wrote that a cyclical low was likely in and that a rally should follow. And to be blunt, that call worked almost perfectly. I nailed the bottom, stepped in right where the risk/reward made sense, and rode the move higher as MSOS ripped off the lows. From an entry standpoint, it was one of my better trades.

Unfortunately, my exit was terrible.

That exit coincided with the day Trump signed the executive order, and I watched a large chunk of unrealized profits evaporate in real time. Anyone who has traded long enough knows that feeling in the pit of your stomach. You do the hard part right, waiting patiently, buying when fear is high, trusting your work and then you fumble the ball on the goal line. It was a painful reminder that having a great entry is only half the battle. The exit matters just as much, if not more. You don’t get paid for being right; you get paid for managing risk and locking in gains.

Fast forward to today, and here we are again approaching another potential opportunity. As you can see on the chart, the next cyclical low is due around February 5th, give or take a few days. Cycles aren’t magic, and they’re certainly not precise to the exact day, but they give you something incredibly valuable: a time window. Instead of guessing blindly, I know that we are entering a period where a bottom should be forming. That alone changes how I think, how I size trades, and how aggressive or patient I’m willing to be.

What continues to impress me is just how accurate this 50-day cycle has been over the past two and a half years. Every cyclical low marked in blue at the bottom of the chart is exactly the same distance apart, yet they line up remarkably well with actual market lows in MSOS. That’s not random. At some point, this cycle will lose its influence, everything works until it doesn’t, but until that happens I’m going to keep trading it because it has earned my respect.

I added to MSOS today and also picked up some TLRY. No, we haven’t received clear confirmation that the cyclical low is officially in yet. I may be early, and I know that. But I did notice some subtle signs of relative strength compared to the broader market’s action today, and that’s often how these turns begin. I’m not swinging for the fences here. I’m positioning myself where the odds start to shift back in my favor, armed with experience, humility from my last exit, and a clear plan for how I want to handle the next move.

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MSOS Prints Its Tightest Range Since Christmas

 

Another quiet day today for MSOS, seriously, was today a holiday or something? Price action was about as sleepy as it gets, but that’s exactly why it caught my attention. Above is a daily chart of MSOS, and in the lower pane you’re not looking at volume. What you’re seeing instead is the daily range for each session. I zoomed in to make it easier to see the recent action, which is why some of the top of the chart got chopped off, but the message is still very clear.

Take a look at today’s bar. The daily range was extremely narrow, in fact, it was the tightest range we’ve seen since Christmas. When ranges compress to this degree, it usually doesn’t last long. Tight ranges tend to precede range expansion, and when that expansion finally comes, it can be fast. This is the kind of environment where I stop being bored and start getting ready.

Structurally, MSOS has now put in what I consider six consecutive lower highs. Yes, I know Friday technically took out Thursday’s high by a single tick, but I was watching it closely in real time, and we never actually saw a bid above Thursday’s high. For me, that still counts as a series of lower highs. That sequence tells me sellers have been able to cap price consistently, even though they haven’t been able to push it meaningfully lower either.

At the same time, MSOS is still holding the daily gap. That’s an important detail. Gaps often act as support on pullbacks, and the fact that we’re holding in this area suggests buyers are still defending it. This is a zone where a bounce can develop, especially if we see volatility start to expand in the right direction.

The way I’m planning to play this is pretty straightforward. I want to see a range expansion to the upside. Ideally, that comes in the form of an opening range breakout or at least early signs of relative strength compared to the broader market. If buyers step in and we start to see momentum build, I’ll be watching closely for price to push above today’s high at 4.09. If that happens with some conviction, I’ll look to grab some more shares for a possible leg higher.

For now, there’s nothing to do but stay patient and stay alert. Quiet days like this often set the stage for bigger moves. The key takeaway here is simple: be ready for range expansion, because MSOS looks like it’s coiling for its next move

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RDW Is Back at a Level That’s Worked Before

 

Well, RDW is once again testing the 13 simple moving average of lows, and this is an area I’ve been paying close attention to. I’ve been using this moving average to successfully trade the last two pullbacks in RDW, so when price comes back to this level, it immediately gets my attention. So far, this average has acted as reliable dynamic support, and now we’re seeing another test to see if it continues to hold.

Today’s high came in at 11.73, which puts 11.75 right on my radar as a potential entry level. A clean move over that price would tell me buyers are stepping back in and that this pullback may be ending. That said, I’m not locked into one specific trigger. How we open tomorrow will matter, and I’ll be watching closely to see whether the stock shows early signs of strength. If I see relative strength compared to the broader market or an uptick in volume, I’d consider an earlier entry. As always, I want the market to confirm my thesis rather than forcing a trade.

One of the more encouraging aspects of this pullback has been the volume profile. Volume has been declining as RDW pulls back, which is exactly what I want to see during a healthy consolidation. Selling pressure appears to be easing rather than accelerating. Today’s volume, in particular, was noticeably lighter than what we’ve seen in recent sessions, and that suggests sellers are becoming less aggressive at these levels.

However, there is one thing that continues to give me pause. Four days ago, RDW printed a very high-volume green candle. That kind of volume stands out, and it often marks an important reference point on the chart. The issue is that we’re currently trading below the low of that candle. When price drops below the low of a high-volume up day, it raises the bar for the next move higher. In order for RDW to push higher from here, I want to see volume really start to pick up again. Without that renewed participation, there’s a risk that any bounce could be short-lived.

For now, I’m staying patient and letting the chart do the talking. The 13 simple moving average of lows is being tested again, volume on the pullback has been constructive, and I have clear levels in mind. If RDW can reclaim momentum with expanding volume, I’ll be interested. If not, there’s no rush. I’d rather miss a trade than step in before the conditions are fully aligned.

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