MSOS Setting Up at Major Support as MACD Turns Bullish

This past week was very interesting for the cannabis stocks, and I want to point out a few things that really stood out to me on the chart. Above is a daily chart of MSOS, and in the lower pane is the MACD indicator. When I look at a setup like this, I’m not just looking for random movement or trying to force a bullish opinion. I want to see whether price is reacting at a meaningful level and whether momentum is beginning to confirm that reaction. Right now, I think that’s exactly what may be taking place.

The first thing that immediately jumps out to me is the major support and resistance zone between $3.00 and $3.35. This is not just some arbitrary line drawn on the chart. This is an area where the market has repeatedly shown us that buyers and sellers care. If you look back, you can see that this zone has acted as both support and resistance numerous times in the past. Every time price has entered this area, the market has responded with a significant move. That is the type of level I pay very close attention to because repeated reactions at the same zone usually mean there is real supply and demand there.

When a level is tested many times and the market continues to react from it, I take notice. That tells me the level has memory. It tells me traders are seeing the same thing, and that’s important because the more eyes on a level, the more meaningful it often becomes. Right now, MSOS appears to be bouncing from that exact support zone, and that immediately puts it on my radar.

The second thing I want to point out is what is happening in the lower pane with the MACD. At point D, the MACD has just now crossed to the upside, giving what many traders would consider a bullish buy signal. On its own, that doesn’t mean much to me. I’ve said many times that I do not rely on indicators by themselves. In fact, a MACD cross in the middle of nowhere is something I usually ignore. But when momentum starts to turn at a major level of support, that gets my attention.

What makes this especially interesting is that we’ve seen this exact behavior before. Every time the MACD was below the zero line and then gave a bullish crossover to the upside, the market rallied significantly afterward. You can see this at points A, B, and C, and now once again at point D. That type of repetition is important because it shows a pattern that has been respected multiple times before.

Take a closer look at point B. The MACD gave a bullish signal while price was holding support, and what followed was a very strong move higher. Then look at point C. Once again, the MACD crossed bullishly at an established support area, and the result was another explosive move to the upside. Those are the types of setups I want to see because they combine price structure with momentum confirmation.

And that’s really the key here. MACD signals by themselves mean very little to me unless they are combined with other tools. I want to see alignment. I want support and resistance, relative strength, volume, and momentum all working together. When multiple factors start lining up at the same time, that’s when I begin to pay closer attention because those are often the setups that can lead to meaningful moves.

Now at point D, we once again have a bullish MACD crossover occurring right at this same important support zone. That doesn’t guarantee anything, of course, but it does suggest that momentum may be starting to shift in favor of the bulls. If that’s the case, then I think higher prices are likely, especially if MSOS can reclaim and close back above $4.00. That would be an important sign that buyers are regaining control and that this bounce has real follow-through behind it.

For now, I think this is a chart worth watching very closely. We have a major level, we have momentum beginning to confirm it, and we have prior examples on the chart showing how powerful these setups can become. Now we wait and see how things unfold.

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Cannabis Stocks Finally Show a Pulse

 

It’s been a while since I last posted about the cannabis stocks and honestly, there has not been much reason to. For most of the month, the group has done very little. Price action has been choppy, directionless, and mostly drifting sideways to lower. That kind of environment usually keeps me on the sidelines because there is no edge in forcing trades when the sector is not showing any real leadership. Today, though, the action finally caught my attention, and I wanted to share what I’m seeing.

What stood out to me was the intraday behavior in MSOS compared to the broader market. On the 5-minute chart, while the S&P 500 was pressing to new lows for the day around 12:30, MSOS was not following it lower. Instead, it was holding up extremely well and consolidating near the highs of the morning. That immediately got my attention because when a sector refuses to break down while the market is weak, I view that as a sign that something may be changing beneath the surface. To me, that kind of divergence is often an early clue that relative strength is starting to emerge.

As the day developed, that interpretation only became more convincing. MSOS continued to hold its ground, and once resistance was cleared, buyers stepped in aggressively and pushed the ETF higher for the rest of the afternoon. That type of move suggests to me that money was entering the space, not just random short covering or noise. When I see a stock or sector absorb market weakness, tighten up near the highs, and then expand upward once resistance gives way, I pay attention. That is the kind of action that can sometimes mark the beginning of a change in character.

Looking at the daily chart adds even more context. MSOS now appears to have the potential to form a double bottom at 3.53. Of course, that setup is not confirmed yet. For me, confirmation would come with a decisive move through resistance at 4.14. Until that level is taken out, it remains only a possibility. Still, the setup is there, and that alone makes the chart more interesting than it has been in quite some time.

Another thing worth highlighting is volume. Today, MSOX posted its highest daily volume candle of the year. That matters to me because volume is one of the clearest ways to judge conviction. When I combine relative strength with unusually heavy volume, I see that as evidence that money may be rotating into the group.

That said, one good day is not enough. Now I want to see follow through tomorrow. Without that, this could easily turn into another false start, which this sector has delivered plenty of before. Still, I have to admit that today’s action was encouraging, and I’ll be watching closely to see how the rest of the week unfolds.

CURLF Holds the Line: Cycle Timing, 200-Day Support, and Early Signs of Leadership

 

So far, the analysis I wrote about ten days ago for CURLF has been spot on, so I want to walk through it again with an update and explain why this area continues to matter. Above is the daily chart of CURLF, and in the lower pane is MSOS, which gives important context for what’s happening under the surface.

On February 9th, I pointed out that CURLF was sitting right on its 200-day moving average. That level isn’t magic, but it does tend to matter, especially in beaten-down groups where institutions are looking for a place to step back in. My thinking at the time was simple: if this stock was going to stabilize anywhere, this was the logical spot. So far, that view has held up. Over the past ten days, the 200-day moving average has acted as support, with price probing it but not decisively breaking below.

What made that test even more compelling was the timing. This move down into the 200-day coincided almost perfectly with the 50-day cycle I had written about. Cycles don’t give exact turning points, but they do define time windows where reversals are more likely. In this case, I said this window was ideal for a cyclical low to form. When price, time, and support line up, that’s usually when I start paying much closer attention.

Fast forward to today’s action, and it looks like we’re finally getting confirmation that a low may be in place. Confirmation doesn’t mean certainty, nothing in markets ever does but the character of the price action is starting to change. Selling pressure appears to be drying up, and buyers are becoming more visible. That’s often how meaningful lows form, not with fireworks at first, but with quiet absorption.

One of the most important tells, in my view, comes from the relative strength comparison with MSOS in the lower pane. From point A to point B, MSOS made a lower low. CURLF did not. Instead, CURLF put in a higher low. That divergence is classic relative strength. When the broader group makes a new low but a leading stock refuses to confirm it, that’s usually a sign that stronger hands are accumulating shares.

This is exactly the kind of behavior I look for when trying to identify potential leaders early. CURLF isn’t outperforming by accident here. Buyers were clearly willing to step in sooner and more aggressively than they were in the ETF. That doesn’t guarantee higher prices, but it does tilt the odds in favor of a constructive outcome.

I want to be clear: I’m not claiming this is “the” bottom or that price can’t revisit these levels. Markets rarely move in straight lines. But when I step back and look at the full picture, the 200-day moving average holding, the cycle window lining up, and the relative strength versus MSOS,  I have to respect what the chart is telling me.

One can never be sure what will happen next, but so far, I like what I’m seeing.

You can read my original commentary regarding CURLF and its 50 day cycle here.

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MSOS Finally Speaks: A Gap Fill, Relative Strength, and a Potential Turning Point

 

Finally, something to talk about in MSOS. After what has felt like a relentless and grueling two months, I’ll admit it was refreshing to see a session that actually mattered. Since MSOS topped out on December 18th, the tape has been unforgiving. Week after week, I watched each support level get taken out one by one. No drama, no snapback rallies just steady pressure and a market that refused to reward early optimism. Those are the kinds of stretches that test patience and discipline, especially when you’re trying to stay objective instead of emotional.

As the weeks dragged on, there was really only one level left that mattered to me, the open gap from December 11th. That gap wasn’t just a random reference point on the chart. It was the last meaningful support from the prior advance, and in my mind it represented the final line between a normal correction and something more damaging. 

Today, it finally happened. MSOS traded down and filled that December 11th gap, and more importantly, buyers showed up in a big way. That alone got my attention, but what really stood out was the character of the move as the day developed. The real tip-off came right after lunch. The S&P pushed to a fresh low on the day, but MSOS refused to confirm it. That relative strength divergence is the kind of subtle tell that doesn’t always show up in a headline, but it matters. It’s often the market’s way of whispering before it starts talking out loud.

Once resistance was taken out (specifically the high of day) the tone changed. MSOS exploded into the close, hitting a high at 4.28.That kind of late-day acceleration isn’t random. It suggests urgency, short covering, and fresh buyers stepping in with conviction rather than hope.

On the daily chart, the structure is even more interesting. We just printed a multi-day bullish engulfing pattern, and the context is what makes it significant. This pattern formed immediately after filling that key gap, not in the middle of nowhere. When you see an engulfing pattern appear at a well-defined support level, it carries far more weight. Add in today’s clear range expansion, and you have the ingredients for a potential trend shift rather than just a one-day bounce.

I’m not declaring victory or calling for a straight line move higher. This market has been too unforgiving for that kind of certainty. But cycles and seasonals still remain bullish, and now price is finally starting to align with that backdrop. After weeks of damage, seeing strength appear exactly where it should is encouraging.

For now, I’m focused on follow-through. If today’s range expansion is real, the next few sessions should confirm it. Let’s see how things unfold.

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MSOS: Basing at Support as We Wait for the Next Catalyst

 

Another week has come to a close, and honestly, there’s nothing especially exciting to report. That in itself probably explains the mood around here. Above is the daily chart of MSOS, and as you can clearly see, we’ve been moving sideways for the past two weeks. No real expansion in range, no decisive breakout, just a slow grind back and forth within a tightening range. It’s not dramatic, but it is information.

The 50-day cycle still suggests that higher prices should begin to emerge in the weeks ahead. That timing window hasn’t changed. If anything, the longer we base here near support, the more meaningful the eventual move could be. The bottom of the channel continues to hold as support, and the gap at 3.76 remains intact. Until that level is decisively broken, the technical structure is still constructive. Price is sitting right where it needs to hold.

It was admittedly a little disappointing that Pam Bondi wasn’t asked about cannabis during her recent appearance. Given how sensitive this space is to any hint of regulatory progress, that omission likely contributed to the lackluster trading we’ve been seeing. There was no new narrative catalyst, no headline spark, and in this sector, silence often translates into drift.

The bigger question still hangs in the air: when will cannabis rescheduling finally be finalized? At this point, trying to predict the timing feels like a fool’s game. Everyone has been wrong about it, myself included. Rather than guessing when the next update will hit the tape, I’m choosing to focus strictly on the technical signals in front of me. The chart doesn’t care about my opinions or anyone else’s timeline. It simply reflects supply and demand.

Right now, we are sitting at key support. Time cycles are pointing higher. Seasonals are also favorable. Historically, January and February have been strong months for cannabis stocks. So far, those seasonals haven’t really exerted their influence this year, but that doesn’t mean they won’t. Sometimes the bias kicks in late. If we’re going to see that bullish tilt, the next couple of weeks would be the window for it to show up.

I won’t sugarcoat it, this has been frustrating. I’ve had capital tied up in this space since last summer, and we’ve essentially been meandering. Not only that, but we’ve given back some substantial open profits along the way. That’s part of trading cycles, but it doesn’t make it any less irritating.

Still, when I strip away the emotion and just look at the chart, the reward-to-risk ratio at these levels is favorable. We’re sitting on defined support. If it fails, I know where I’m wrong. If it holds and the cycle turns up as expected, the upside could be meaningful.

For now, patience remains the trade. Let’s see what next week brings.

For more analysis and market insights, visit my homepage