STF Cronos Group INC / CRON short. Time for a cool down.

23. Aug. 2018

Cronos has performed great, especially today amid a minor weed stocks sell-off but the chart is showing signs of exhaustion and fundamentally it is over-priced for its sector, despite being one of the few making money.

FA
Horizons cannabis fund HMMJ and MJ will begin re-balancing around September. I predict some of CRON will be sold-off to maintain weighting.
Weed stocks are all "over-priced" and the recent cannabis supply agreement in Canada may mean further government supplied products hitting the market.

TA
RSI's both show over-bought.
Big gap up followed by lower volume.

24. Aug. 2018

Anmerkung

News of UK alcohol company Diageo talking to 3 Canadian cannabis companies has caused a lot of pre-market trading, expecting CRON to gap up to around 9.25.

I am confident there will be some selling into the weekly close as the reasons for shorting still stand and I am sceptical of Diageo taking a significant stake in CRONOS at a potential PE of >1000.

Will adjust SL accordingly, R:R will now be 2:1

Bad timing for this short, considering other long trades I am working factor in possible mergers and buy-outs in the cannabis sector.

Source:
bloomberg.com/news/articles/2018-08-24/diageo-in-talks-with-three-canadian-weed-producers-bnn-says

24. Aug. 2018

Trade geschlossen: Stop wurde erreicht

SL was hit.

Bearish factors remain, but bad timing on my behalf in regards to Diageo news.