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Keith Speights

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Their share prices might be lower because of the COVID-19 outbreak, but their long-term prospects still look great.

It’s not too late to buy great stocks at attractive prices. Despite the stock market’s bounce last week, there are still plenty of stocks with tremendous growth prospects that are priced at a discount.

But which stocks have the greatest chances of delivering stellar returns? I think that $5,000 invested in each of the three following stocks should make you a fortune over the next 10 years.

1. Alteryx

There’s more data being generated than ever before. And that means there’s a greater need to analyze data than ever before. The problem is that most of the tools available for data analysis fall short of meeting users’ expectations. They’re too cumbersome and too complicated. Alteryx (NYSE:AYX) provides the answer to these problems.

Alteryx’s data analytics platform doesn’t require any programming (although it’s compatible with the leading data analysis programming languages). The company’s focus on usability is paying off. Its platform won the 2019 Gartner Peer Insights Customer Choice award for data science and machine learning platforms. Over 6,000 customers now use Alteryx’s platform, including 719 of the 2,000 biggest companies in the world.

But Alteryx still has a tremendous growth opportunity ahead of it. Market researcher IDC projects that the big data and analytics software market will total $49 billion globally in 2021. Alteryx should capture an increasing share of that market as more customers standardize their data analysis using its platform.

Its shares might look ridiculously expensive with a forward earnings multiple of 123. But keep in mind that Alteryx’s valuation is based on expectations of tremendous growth over the next few years. I think that it will deliver on those expectations. And with its shares still way off their highs from earlier this year, there’s no better time to buy Alteryx than now.

2. Square

You might not have realized that there’s a war going on around you — the “war on cash.” This war encompasses a major trend of consumers switching from using physical currency to electronic forms of payment. Square (NYSE:SQ) ranks as a top general in this war on cash.

Square is best known for its small card readers used by many small and medium-sized businesses. This payment processing service is the foundation of an entire ecosystem that the company offers, with other products and services including customer loyalty, marketing, payroll, and e-commerce applications. Square also provides loans and debit cards to businesses.

In addition to its focus on businesses, Square is a major player in the peer-to-peer payments arena with its Cash App. PayPal’s Venmo has been the leader in this market, but Cash App is catching up quickly. It’s generating strong revenue growth for Square and also presents a larger customer base to which the company can market new products and services.

Sure, Square stock has been shellacked by the COVID-19 pandemic as its customers reel from the impact of quarantines and non-essential business shutdowns in many areas. But I think this presents an awesome buying opportunity. The economy will bounce back and so will Square.

3. The Trade Desk

There’s also another big trend under way that could have escaped your attention. The days of personal negotiations to place advertising spots are numbered as advertising agencies turn to programmatic advertising, which uses software applications to buy ads quickly and cost-effectively. The Trade Desk (NASDAQ:TTD) is the clear leader in buy-side programmatic advertising.

The most significant catalyst for The Trade Desk is the rise of connected TV (CTV). CTV includes all of the streaming services that have gained widespread popularity. Not all of them use ad-based models, but quite a few of them do. The Trade Desk CEO Jeff Green recently said that “we are in the middle of a once-in-a-lifetime consumer shift to connected devices and streaming content.” And that consumer shift presents a huge opportunity for his company.

Programmatic advertising still only represents a small part of the total ad market. But with programmatic ad spending growing five times as fast as overall ad spending, it won’t take too long before it makes up a big share of the market. The Trade Desk stands to benefit from this growth.

Shares of The Trade Desk plunged as much as 49% during the coronavirus-fueled market sell-off before rebounding somewhat. It’s likely that some advertisers could cut their marketing budgets to save costs during this challenging period. But the long-term prospects for The Trade Desk remain very bright. My view is that buying this stock now at a discount should set up investors for terrific returns over the next decade.

Author: Keith Speights

Source: Fool: $5,000 Invested in These 3 Stocks Should Make You a Fortune Over the Next 10 Years

The billionaire investor is almost certainly buying stocks during the stock market crash. Here are three top candidates for his shopping list.

Warren Buffett’s net worth has dropped by a number that’s hard to fathom in just a matter of weeks. But the legendary investor isn’t worried. One of Buffett’s goals is “to be fearful when others are greedy and to be greedy only when others are fearful.” He also once stated, “Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble.”

There are certainly a lot of investors who are very fearful right now. But the Oracle of Omaha undoubtedly sees the current coronavirus-caused market meltdown as one of those rare opportunities where it’s raining gold.

We won’t know for another couple of months which stocks Buffett and his investment managers are buying for Berkshire Hathaway’s (NYSE:BRK.A) (NYSE:BRK.B) portfolio. But I suspect that there are at least three stocks Warren Buffett is probably buying during the coronavirus market crash.

1. Apple

Buffett simply loves Apple (NASDAQ:AAPL). He stated in a recent interview that “it’s probably the best business I know in the world.” In 2018, the billionaire even said that he’d “love to own 100%” of Apple if he could.

The problem, of course, is that even a company the size of Berkshire Hathaway couldn’t take too big of a bite out of Apple. But with Apple stock down nearly 30% off its highs, it’s a lot cheaper now. It wouldn’t be surprising at all if Buffett is taking the opportunity to scoop up more shares.

Buffett firmly believes that the coronavirus outbreak presents only a short-term risk for Apple. He remains confident about the company’s prospects over the next decade, stating, “All kinds of things are going to happen to Apple over the next 10 years.”

Remember that Buffett likes to buy wonderful companies at a fair price. He clearly thinks that Apple is a wonderful company. The big question is if he thinks the price is fair now. I suspect the answer to that question could be “yes.”

2. Bank of America

The banking industry has been one of Buffett’s favorites for a long time. Berkshire Hathaway currently owns shares of more than half a dozen bank stocks. Its biggest bank position is in Bank of America (NYSE:BAC). I think that Berkshire’s stake will grow even bigger as a result of the market crash.

Shares of Bank of America have fallen more than 40% off of their highs. The stock is now a bargain, trading at less than its book value. Buffett was mentored by value investing legend Ben Graham, who relished finding stocks of high-quality companies with book values higher than their market caps.

Thanks to the major stock decline, Bank of America’s dividend is also the most attractive it’s been in more than a decade. Although Berkshire doesn’t pay a dividend, Buffett loves them.

My hunch is that Buffett is looking at Bank of America’s growth prospects as much as he is its valuation and dividend. The company was already generating stronger growth than most of its rivals. It has also invested heavily in technology to become more competitive. Sure, Bank of America will suffer for a while, but it will bounce back. And Buffett knows it.

3. Southwest Airlines

Berkshire owns stakes in three major airlines. Warren Buffett stated in a recent interview that he “won’t be selling airline stocks.” I think it’s much more likely that he could be buying airline stocks instead — especially Southwest Airlines (NYSE:LUV).

While all three airline stocks in Berkshire’s holdings have taken a shellacking, Southwest has held up the best of the group. Its shares are down 45%. That could be enough of a drop to tempt Buffett to pick up more shares, especially with U.S. government financial assistance potentially on the way.

Of course, Buffett once called the airline industry “a death trap” for investors. But he started buying airline stocks once he saw that they were operating with increased fiscal discipline. No airline has consistently demonstrated such discipline than Southwest.

Berkshire currently has a bigger position in Delta Airlines than it does in Southwest. Don’t be surprised if the next regulatory filing showing the company’s holdings reveals that its stake in Southwest has caught up to the position in Delta.

Author: Keith Speights

Source: Fool: 3 Stocks Warren Buffett Is Probably Buying During the Coronavirus Market Crash

Bitcoin (BTC) hodlers deserve a pat on the back for making it through this last week, as BTC witnessed its largest sell-off in history, in terms of USD value, causing the leading digital asset to shed $70bn of its market cap in a single 24-hour period.

I shudder to think about the fortunes that were lost, but as we are left reeling in the aftermath of this selloff, a question remains. Could anyone have seen this coming? And has the outlook for Bitcoin now changed?

These are two questions I will attempt to address in today’s analysis.

Sorry, not sorry… I called it in January

In my analysis that was published on Jan. 12, I put forward the case that Bitcoin could fall to $3,800 by April 2020.

BTC USD monthly chart. Source: TradingView

I came to this conclusion when I realized that the monthly volume had been in a steady decline for several years and that the moving average of the Bollinger Bands on the monthly chart has been broken every month in the last quarter of 2019.

I also saw similar patterns on the monthly and weekly Moving Average Divergence Convergence (MACD) indicator that we had seen back in July 2018, which resulted in BTC price falling from $8,500 to sub $4,000 in a matter of months.

When I mashed these things together it made something abundantly clear, there isn’t enough buying interest in Bitcoin for us to reach new all-time highs.

Oh and I called it again last Sunday

I can already hear the tapping of the angry keyboard warriors hammering down on their Macbooks that I didn’t call anything, and that even a broken clock is right twice a day.

BTC USD 4-hour Source: TradingView

Perhaps, I would draw the same conclusion if I was a small-minded neanderthal that honestly believes my one to three-word comment on Twitter is a valid contribution to an open Bitcoin price discussion.

A discussion that I start every Sunday when I give up valuable time with my wife and three kids in order to deliver my impartial interpretation of the charts. I didn’t mention the $4,000 scenario again because just three days after my analysis on Jan. 15, Bitcoin broke out of the 7-month downtrend channel it had been bouncing around in since the June 2019-Libra FOMO pump.

However, I did mention it again in my analysis last Sunday, since we had fallen into a steep descending channel that was about to break into the previous 7-month downward trend again. In other words, if $7,500 failed to hold there was no support all the way to $4,000

Someone else called it too
Resident gold-bug and renowned Bitcoin-hater Peter Schiff was quick to tweet out something many of us should have taken more seriously.

Just 32 minutes after the trendline on the hourly time frame was broken, the same trendline I was looking at on the 4-hour chart just a few days prior, Schiff tweeted the following:

“If any institutional money ever actually went into #Bitcoin it’s about to come out, never to return. Bitcoin has finally proven conclusively that it’s neither a store of value, a safe haven, nor a non-correlated asset. The Bitcoin chain letter has finally run out of links!”

It’s important to understand why Schiff may watch Bitcoin so closely and why he may be so intent on dissuading people from investing in it. Notably, here’s something I haven’t seen anyone mention before.

His bank, Euro Pacific Bank, has a target customer base of high-net-worth individuals looking for offshore tax structures. For a long time, Bitcoin has been seen by some as an alternative place to park your wealth as opposed to exploiting questionable tax loopholes, so it’s clearly in Schiff’s interest to see Bitcoin fail as it directly attacks his business model.

But while I doubt that institutional money is leaving Bitcoin for good, I believe that Peter Schiff’s comment makes sense and that institutions that bought the last 4-month dip where Bitcoin traded between $3,000 and $4,000 knew it was time to exit the market.

If this is the case, it could end one of the popular theories being pushed right now about stocks and Bitcoin being correlated.

Did equity margin calls spark the Bitcoin sell-off?

If it’s true that institutional investors just withdrew from Bitcoin, then this bounce from $3,850 might signify that we have not only bottomed, but we might be about to decouple from any possible correlation with the stock market.’

BTC USD/ S&P 500 Daily Source: TradingView

The math is quite simple, the S&P market cap is around $25 trillion versus Bitcoin’s pre-dump market cap of $150 billion. Simply put, institutions stood to lose more from the S&P crashing than from their Bitcoin holdings.

So in the likely event of stock market margin calls as prices began tumbling amidst the coronavirus global panic, what was the fastest liquid asset they could realize?

The answer was most likely Bitcoin. And by all exiting at the same time (because they all had the same reason to exit) you end up with exactly the same situation you get when an ICO gets their team tokens unlocked, i.e. large holders crash the price leaving smaller holders left holding their depleted bags.

Bitcoin’s epic crash gives a few reasons to be optimistic

Despite all this blood, there is some light on the horizon. The wick on the bounce from $3,850 has left the support line intact on the daily. This means that the support is currently around $4,400 and will slide to around $4,000 by April 1.

True holders are unfazed

However, the resistance to break out of this channel once and for all is currently around $7,400 and will fall to around $7,100 by April 1. So if it’s true that institutional money really has left, then this range will theoretically hold despite any further selloffs in the stock market.

Newcomers can now enter at lower prices

This, in turn, should bring confidence back to Bitcoin and create the opportunity for people, who previously thought they were too late to the party, to step in and start buying at fire-sale prices.

Future selloffs won’t be as extreme

The reason this is not only good but, in my opinion, great for Bitcoin is that by having Bitcoin held by a large number of small holders as opposed to a small number of large holders, means that it is less likely for a catastrophic sell-off to occur in the future. This will also enable the digital asset to build on its new support level.

Don’t expect these prices to last for months

BTC mining difficulty. Source: BTC.com

The mining difficulty is still increasing whilst the price is falling and the halving is only 57 days away. This means that soon any Bitcoins entering the market will be doing so at a much higher rate than the current price as they will have a higher production cost.

It may not happen overnight but when it does, it’s likely to trigger one of the most impressive bull runs that we have ever witnessed, and whilst I don’t personally expect this to happen for at least another 6 months, I also don’t expect these prices to last for long or go much lower.

Bearish scenario

It’s still a very turbulent time for the crypto-sphere as a whole. Should the support of $4,400 ($4,200 by next weekend) fail to hold, then the charts point to $2,450 as the next level of support.

Prices this low would either spark a huge FOMO rally or a further lack of confidence. However, if people have “hodled” through the pain of this past week, I can’t see them selling should $2,450 hit either as this would be capitulating at an obvious bottom.

Bullish scenario

On the bullish side, there is still the CME gap at $9,165, but now that institutions are supposed to have exited the market, it’s unlikely we will see these fills as regularly as we used to. Moreover, it may even lead to a reduction of traders on leverage platforms and a return to spot exchanges. In other words, an early “alt season” may then become a possibility as people attempt to regain their losses by speculating on altcoins again.

The resistance levels to break now are $7,400 and then $8,000 before opening up $11,250 as the next target that would put Bitcoin on the same upward path it broke into on January 15.

Author: Keith Wareing

Source: Coin Telegraph: 3 Silver Linings to Last Week’s Epic 50% Bitcoin Price Crash

The Oracle of Omaha has given some words of wisdom on exactly what you should do.

If there’s one person investors should listen to during a market correction, it’s Warren Buffett. At age 89, Buffett has lived through quite a few downturns. And he’s made out pretty well: His net worth is in the ballpark of $85 billion.

Through the years, the Oracle of Omaha has given a lot of great advice in his annual letters to Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B) shareholders. He has even written about a specific approach for how investors should handle a “super-contagious” disease.

It’s not what you think

Buffett has been interviewed in recent days about his thoughts about what investors should do in response to the global coronavirus outbreak. His take was that it wasn’t a good idea to buy or sell stocks based on daily headlines. But that’s not the advice I’m referring to.

In early 1987, Buffett wrote to Berkshire Hathaway shareholders about what to do in the face of an epidemic. This was, of course, way before the outbreak of the novel coronavirus that’s causing worldwide concerns today. It was even before the avian flu, Ebola, SARS, or MERS made the news.

But more than 30 years ago, Buffett addressed two “super-contagious diseases.” He told readers that there are “occasional outbreaks” of these diseases and that they will “forever occur.” Buffett admitted, though, that “the timing of these epidemics will be unpredictable,” cautioning to “never try to anticipate the arrival or departure of either disease.”

What were these two diseases? Fear and greed among investors. Buffett stated that his goal to deal with these “epidemics” was “to be fearful when others are greedy and to be greedy only when others are fearful.”

Time to be greedy

There’s no question that plenty of investors are fearful right now. The so-called fear index — the CBOE Volatility Index (VIX) — has skyrocketed over the past couple of weeks. When the VIX goes up a lot, it’s a clear sign that many investors are scared. If you think that Warren Buffett was right in 1987, though, that means it’s time to be greedy.

Gordon Gekko, the fictional character in the 1987 movie Wall Street played by actor Michael Douglas, famously stated that “greed is good.” The line has been slammed through the years as being representative of an unhealthy fixation on making money.

But I think that Buffett’s definition of greed is different than Gordon Gekko’s. When Buffett wrote about being greedy when others are fearful, he was referring to buying stocks at an opportunistic time. A time like now.

The reality is that the market correction has left quite a few stocks valued at very attractive levels. My Motley Fool colleague Jeremy Bowman recently wrote that Walt Disney (NYSE:DIS) stock “may never be this low again.” I don’t know if Jeremy will be proved right or not, but I think he’s absolutely correct that Disney is a great stock to buy with its share price hammered by coronavirus worries.

When Buffett wrote to Berkshire shareholders in 1987, the stock market was soaring. Instead of fear, there was euphoria. He somewhat sarcastically noted, “What could be more exhilarating than to participate in a bull market in which the rewards to owners of businesses become gloriously uncoupled from the plodding performances of the businesses themselves.”

Now, though, the opposite scenario is taking place for stocks like Disney. To paraphrase Buffett, Disney’s share price has become gloriously uncoupled from the great performance of the business itself. There are other stocks for which this is true as well. Buy them. Be greedy in the Warren Buffett way.

What Buffett doesn’t know

There’s one other thing Buffett wrote in 1987 that I think is especially relevant right now. He stated, “We have no idea — and never have had — whether the market is going to go up, down, or sideways in the near- or intermediate-term future.” Amen to that.

Keep that in mind as you contemplate whether you should buy now or wait to see if the stock market will fall even more before scooping up shares of wonderful businesses like Disney. Buffett doesn’t know what’s going to happen next with the stock market, and neither do you.

What we can all know, though, is that there’s a lot of fear right now. And it’s causing stocks with tremendous growth prospects to be priced more attractively than they’ve been in quite a while. Don’t let this “epidemic” be wasted.

Author: Keith Speights

Source: Fool: Warren Buffett’s Advice on How Investors Should Respond to a Super-Contagious Disease

Investors are responding enthusiastically to the changing dynamics in the Democratic presidential race.

What happened

Big health insurance stocks soared on Wednesday after the results from the Democratic Super Tuesday primaries. Shares of Anthem (NYSE:ANTM) were jumping 13.9% higher as of 11:12 a.m. EST. Humana (NYSE:HUM) wasn’t far behind, with its stock up 13.4%. Cigna’s (NYSE:CI) shares were rising 10.1% higher. UnitedHealth Group (NYSE:UNH) stock was climbing by 9.9%, while CVS Health (NYSE:CVS) shares were up 4.5%.

So what

The impressive performance by former Vice President Joe Biden in the Democratic primaries on Super Tuesday boosted investors’ optimism about the prospects for health insurers. Biden won at least nine states and 351 delegates compared to three states and 280 delegates for Vermont’s Sen. Bernie Sanders. Two states — California and Maine — haven’t been called yet by The New York Times, although Sanders is the clear leader in California while Biden has an edge in Maine.

Sen. Sanders advocates a Medicare for All program that would largely eliminate the need for health insurance. His strength in the ongoing presidential campaign caused investors to worry about what might happen with big companies including Anthem, Humana, Cigna, UnitedHealth Group, and CVS Health (which owns Aetna).

Now, however, former Vice President Biden appears to be the frontrunner for the Democratic presidential nomination. Several candidates have dropped out of the race and endorsed Biden, with former New York City mayor Mike Bloomberg the most recent to do so.

Biden’s healthcare plan is to preserve and expand Obamacare. He wants to allow individuals to buy health insurance similar to Medicare, an idea that’s referred to as the “public option.” Biden also seeks to extend coverage under Obamacare to more Americans.

This plan is much more attractive to major health insurers than Sanders’ Medicare for All proposal. Anthem, Humana, Cigna, CVS Health, and UnitedHealth Group benefited from Obamacare and could do so under Biden’s healthcare plan as well.

Now what

The battle to win the Democratic presidential nomination isn’t over. It’s still possible that Sen. Sanders could emerge as the party’s nominee. Should he prevail, healthcare stocks, in general, and health insurance stocks, in particular, will likely be highly volatile.

However, the probability that Sen. Sanders’ Medicare for All plan will become a reality appears to be lower now than it was just a few days ago. Joe Biden’s surprisingly strong performance on Super Tuesday certainly improves the prospects for health insurers who would face an existential threat under Sanders’ healthcare program.

Author: Keith Speights

Source: Fool: Here’s Why Big Health Insurance Stocks Are Soaring Today

The worst performer among these stocks has soared more than 70% over the last 12 months.

The healthcare sector hasn’t been a big winner for investors over the last 12 months. Shares of the largest healthcare-focused exchange-traded fund (ETF), Health Care Select SPDR ETF, are lagging well behind the performance of the S&P 500.

But not all areas within the healthcare sector are performing poorly. Three diabetes stocks in particular continue to be sizzling hot. If you want to get rich investing in healthcare, you definitely need to check out DexCom (NASDAQ:DXCM), Insulet (NASDAQ:PODD), and Tandem Diabetes Care (NASDAQ:TNDM).

1. DexCom

Shares of DexCom have more than doubled over the last 12 months. The key reason for the stock’s fantastic performance is fast-growing sales of the company’s G6 continuous glucose monitoring (CGM) system.

DexCom’s latest quarterly results show just how successful the company’s G6 CGM is right now. The company’s revenue jumped 37% year over year in Q4 2019 to $462.8 million, well above the consensus Wall Street estimate. This strong revenue growth helped DexCom to also trounce analysts’ fourth-quarter earnings estimate.

The company benefited from its launch of the G6 into the U.S. Medicare market. It expanded its global operations. DexCom also partnered with major healthcare organizations like UnitedHealth Group to increase the use of its CGM system by individuals with type 2 diabetes.

2. Insulet

If you liked DexCom’s big gains, you’ll love Insulet’s performance. The stock has skyrocketed more than 140% over the past 12 months, powered by rapidly growing demand for its OmniPod insulin pumps for individuals with Type 1 or Type 2 diabetes who require insulin.

Insulet won’t report its fourth-quarter results until next week, but the company’s Q3 update in November underscored the tremendous momentum for OmniPod. Sales for the insulin pump jumped 34% year over year to $177.2 million, accounting for over 92% of the company’s total revenue.

OmniPod is much more convenient than traditional insulin shots, with one “pod” replacing up to 14 injections each day. It’s also differentiated from other leading insulin pumps because it’s tubeless, waterproof, and easily hidden beneath clothing.

3. Tandem Diabetes Care

Insulet isn’t the only insulin pump maker that’s on a roll. Shares of Tandem Diabetes Care are up more than 70% over the past 12 months, thanks primarily to continued success for the company’s t:slim X2 insulin pumps.

Like Insulet, Tandem is scheduled to report its fourth-quarter results next week. It seems likely that the company will continue its momentum from Q3, when it announced that its revenue more than doubled from the prior-year period to $94.7 million, with especially strong growth in international markets.

Tandem’s strategy has been to focus heavily on introducing innovative new products based on its core t:slim platform. The company has launched six new insulin pump versions over the last six years. Tandem’s slogan for t:slim X2 — “the pump that gets updated, not outdated” — highlights one of its competitive advantages. In addition, t:slim X2 is smaller than other leading insulin pumps and already integrates with DexCom’s CGM systems.

Why these diabetes stocks could get even hotter

Investing in healthcare stocks that focus on diabetes should be a winning strategy for the future based on demographic trends alone. There are around 463 million people across the world with diabetes — and that number is growing. Only around 6% of individuals with diabetes don’t develop complications. This creates a massive opportunity for medical devices that help effectively manage diabetes.

All three of the diabetes stocks mentioned have catalysts on the way that should enable them to succeed in 2020 and beyond. DexCom is launching the G6 CGM in more international markets and plans to conduct the biggest product launch in its history on a full scale in 2021 with its new G7 CGM system. Insulet recently announced plans to integrate with DexCom’s G6 and G7, as well as Abbott Labs’ popular Freestyle Libre CGM. Tandem just launched its latest version of the t:slim X2 insulin pump, which is the first system to deliver automatic correction boluses of insulin and adjust insulin levels to keep blood sugar levels within thresholds.

There’s no guarantee that you’ll get rich investing in DexCom, Insulet, and Tandem. But these three diabetes stocks appear to be on a track to continue generating strong gains for long-term investors.

Author: Keith Speights

Source: Fool: Want to Get Rich Investing in Healthcare? Check Out These Diabetes Stocks

These pot stocks have what it takes to deliver massive returns.

Any stock theoretically holds the potential to make you a millionaire. But few actually do. Stocks with the greatest likelihood of building fortunes tend to have small market caps and huge market opportunities.

Cannabis definitely offers a huge market opportunity. The global cannabis market could expand close to tenfold over the next 10 to 15 years. Many players in the cannabis industry remain small and have a lot of room to grow as the market opportunities unfold. Which marijuana stocks can investors buy right now that hold the potential to be millionaire-makers? Here are three that I think are at the top of the list.

1. Valens

Valens (OTC:VLNCF) is a virtual lock to profit in a big way as the global cannabis market expands, in my view. The company provides services to extract cannabinoids such as CBD and THC from cannabis plants.

It’s a pretty safe bet that the demand for cannabis extraction will soar over the next few years. The Cannabis 2.0 cannabis derivatives market in Canada is just getting started. Products including cannabis-infused beverages and foods as well as vapes are expected to rack up billions of dollars in sales. In the U.S., the legalization of hemp in late 2018 should drive increased demand for products containing hemp-derived CBD.

Valens is set to be a major winner in Canada’s Cannabis 2.0 market and could make significant headway into the U.S. market, too. It boasts the highest extraction capacity in the industry. The company’s customers include many of the biggest names in the business —Canopy Growth, HEXO, Organigram (NASDAQ:OGI), Tilray, and more. With a market cap of around $350 million, I think that Valens should deliver massive returns over the next decade.

2. Organigram

One of Valens’ customers should also achieve tremendous success in the not-too-distant future. Organigram isn’t the largest cannabis producer in Canada, but it’s arguably the best.

Most of the major Canadian cannabis producers are struggling to establish a clear path to profitability. Organigram, though, appears to be in a good position to become profitable after its stellar fiscal 2020 first-quarter results announced a few weeks ago. The company’s low cultivation costs and fiscal discipline put Organigram in the top tier of cannabis producers. Its market cap of around $450 million — lower than most of its key rivals — makes Organigram a better bargain.

Several factors should fuel Organigram’s growth. The company’s sales should soar as the Cannabis 2.0 market in Canada picks up steam. Ontario, Canada’s most heavily populated province, is opening more retail stores throughout 2020. I also wouldn’t be surprised if a large consumer packaged goods company partners with Organigram, opening the door for the cannabis producer to more effectively reach the global cannabis market.

3. Innovative Industrial Properties

With a market cap of over $1.2 billion, Innovative Industrial Properties (NYSE:IIPR) is a good bit bigger than Valens and Organigram. However, I think that IIP remains small enough to provide huge returns over the next few years — just as it has done over the last three years.

IIP is the largest cannabis-focused real estate investment trust (REIT). It acquires properties and leases them to medical cannabis operators in deals that free up cash flow for tenants and provides an ongoing revenue stream to IIP. So far, the company has 48 properties in 15 states. But that number will almost certainly continue to grow rapidly.

There are currently 18 states with legal medical cannabis markets that IIP hasn’t entered yet and more states are likely to vote to legalize medical cannabis in November. The cannabis markets in many of the states were the company already operates are still in their early stages. IIP also has a big opportunity in expanding its relationships with existing multistate cannabis operators such as Cresco Labs.

Author: Keith Speights

Source: Fool: 3 Marijuana Stocks That Could Be Millionaire-Makers

Bitcoin price (BTC) has been in a sidewards range for several weeks now, with some people on team bear calling for fresh lows in the region of $3,000 while the bulls have been calling for astronomical all-time highs soon. One thing that is apparent in the market, is that you have to take it one week at a time.

With Bitcoin currently heading towards the mid-$7,000 range, is it time to flip bullish? Or is this yet another low liquidity Sunday pump to create CME gap-filling opportunities?

But Sir, the CME gap

Whether you are leverage trading, or simply moving your Bitcoin into a stablecoin during the dips, if you are not capitalizing on the weekly CME gap, you’re missing a trick. However, the more obvious these gap fill trades become, the more likely it is that they will soon become a thing of the past.

Christmas week is a week that I took off trading. The reason is that the CME was closed on the 24,25 and 26th of December, which meant attempting to trade a gap fill was slightly more difficult. As the gap left on Friday, Dec. 20 would have needed to fill on Monday, Dec. 23, and then Monday, Dec. 23 left a new gap to be filled on Friday, Dec. 27.

Next week is set to be the same, with the CME Holiday Calendar citing that trading will be closed Dec. 31 to Jan. 2, 2020.

It seems that traders with greater exposure to Bitcoin are driving the price during the weekend when the volume is thinner, and then waiting on institutional traders to fill the gap the following week.

However, with institutional money taking an extra 6 days off over the holiday break, it means more thin volume periods for the price to be driven by whales in this 24/7 market.

So while the bankers may sleep, Bitcoin, in fact, does not sleep, and this could open up a window for a short-term rally before the bear cycle resumes.

The weekly MACD has started to lean bullish

The Moving Average Convergence Divergence (MACD) indicator is showing early tell-tale signs of a bullish reversal. However, I don’t expect this to continue. As can be seen in the image above, the MACD line changed its bearish course on Dec. 16, but why?

I believe that due to a lack of institutional interest over the Christmas period, the market was easily moved upwards, which has changed the trajectory and with it, has continued to print pale pink candles, which are getting shorter by the week, usually indicating a cross into green territory. This has given some hope of a relief rally before the real pain begins for Bitcoin.

But where could we see the digital asset move?

The weekly Bollinger Bands suggest a temporary bottom

Using Bollinger Bands (BB) Indicator overlayed with my indicator that shows pivot points based on momentum, Bitcoin appears to have entered a short-term bull phase that will most likely see a rejection around the moving average of $9,000.

I believe this to be the case, as short-term low liquidity pumps falter around the moving average, as can be seen at the end of October. This is where Bitcoin price experienced an unnatural pump, which saw the digital asset climb around $2,500 in 48 hours, and despite a momentary wick above the MA, it failed to hold above this point and soon resumed its bear trend, feeding off the blood of hodlers at the bottom of the BB.

As such, with the institutional players easing up over the holiday period, it’s a perfect opportunity for the price of Bitcoin to be pushed up to around this level.

At this stage, you may be asking why I only see a short-term relief rally and not a full reversal. The reason for this lies in the Relative Strength Index (RSI) indicator.

The RSI shows no clear buy signal

The RSI is currently very much in the middle with a reading of 42.20 on the weekly. This doesn’t signal anything to anyone, and as such, would not attract any significant money into the market. When the RSI is planted between 30 and 70, we’re simply in a ranging market where scalpers feed and hodlers bleed.

Right now, anyone with any significant cash holdings would be hesitant to go all-in on an asset at this point, whether it be Bitcoin or anything else. As such, this to me says we must first see more downside before Bitcoin becomes an attractive investment opportunity for smart money.

You only have to look at the end of 2018 and the beginning or 2019 where Bitcoin held an average price of $4,000 to see why the RSI is a valid indicator for buying Bitcoin, as buying in the oversold territory would have seen you gain over 300% on your investment throughout 2018.

As Bitcoin continues to stay in a sidewards range, the inevitability of an extinction-level event that will cause even the die-hard Bitcoin maximalists to question why they HODL lines of code, looks more and more likely.

Having pierced through the MA two months in a row, and with the red candles getting longer by the month, it seems that Bitcoins support is only around $400 away, before falling to painful lows.

The support on the Bollinger Bands is currently $2,550 and whilst Bitcoin has never actually touched the support on the monthly BB, that’s not to say it won’t have a good run towards it should $7,010 fail to hold in the short term.

Bullish scenario

With the CME only being open 2 days next week, expect the unexpected. This could go both ways (and I expect it probably will). But from a bull’s perspective, I’d be looking at the moving average on the weekly of $9,000 as the target before being rejected. If it continues past this price, the next level of resistance is $11,300. However, this doesn’t seem likely.

Bearish scenario

After the CME gap fills at $7,265 — which is likely to happen tomorrow — history tells us that the price will revert to the previous trend. However, should it continue to fall, the Bitcoin price only needs to fall a further $150 before it finds itself at the support of $7,010.

If this fails to hold, it’s game over Bitcoin, and the road of pain will truly begin. Any move below $7,000 could quickly recover on Friday, Jan. 3 depending on when the CME closes Monday evening.

But since this is still the holiday season, I don’t expect the real bear trend to resume until the week commencing on Jan. 6 once all the suckers have gone long. That being said, if it did continue to fall, $6,800 is the support on the daily BB for Bitcoin, which is a key level to take note of.The Daily RSI is Neutral

The daily RSI is also incredibly neutral, more-so than the weekly RSI. It’s currently sitting on 52.16, which again sends no buying or selling signal to investors.

A pump towards $9,000 would certainly plant this in oversold territory, which could spark a sell-off, with people trying to cover their hemorrhaging losses after FOMO-ing in at $10,000 levels earlier this year thanks to a wave of social media influencers prematurely declaring that BTC is in a bull market.

Incidentally, the monthly RSI is reading the same as the daily, so no need to look at that today. However, I will look at the monthly BB.

Bitcoin is struggling to stay above the Moving Average

Author: Keith Wareing

Source: Coin Telegraph: Bitcoin Price Could Rally to $9K Before a Massive Collapse, Here’s Why

More pipeline activity than ever before could usher in a big boom for CRISPR gene-editing stocks next year.

Has there been a lot of hype about CRISPR gene editing? Absolutely. But while the hype might have been overdone in some cases, the reality is that there’s significant potential for CRISPR (which stands for “clustered regularly interspaced short palindromic repeats”) to transform the way many diseases are treated.

2019 has been an important year for the top CRISPR gene-editing stocks with the first human clinical studies cranking up. CRISPR Therapeutics (NASDAQ:CRSP) has been the biggest winner — mainly because those studies were for its lead pipeline candidate. However, Editas Medicine (NASDAQ:EDIT) and Intellia Therapeutics (NASDAQ:NTLA) have also racked up nice year-to-date gains.

But as Bachman-Turner Overdrive sang, “You ain’t seen nothing yet.” Here’s why 2020 should be the biggest year so far for CRISPR gene-editing stocks.

Key clinical studies

CRISPR Therapeutics and its partner Vertex Pharmaceuticals (NASDAQ:VRTX) already announced encouraging preliminary results in November from the first clinical studies to date for a CRISPR gene-editing therapy. Nine months after receiving an infusion of CRISPR therapy CTX001, a patient with rare blood disease transfusion-dependent beta thalassemia no longer needed transfusions. In the other study, a patient with sickle cell disease was free of vaso-occlusive crises (VOCs) — a painful complication of sickle cell disease — four months after receiving an infusion of CTX001. This patient previously experienced an average of seven VOCs per year.

It’s still really early and the preliminary results were only for two patients. However, the news was positive enough that Vertex CEO Jeffrey Leiden was talking about CTX001 having the potential to cure beta-thalassemia and sickle cell disease.

2020 should bring more results that could increase the buzz about a potential cure for the two genetic diseases. The primary results from CRISPR Therapeutics’ two early stage clinical trials aren’t scheduled to be available until early 2021. However, the primary endpoints of both studies focus on meaningful improvement for at least three months starting six months after CTX-001 infusion. If additional patients experience the level of improvement seen in the first two patients, we’ll likely hear about it next year.

Don’t be surprised if CRISPR Therapeutics provides a sneak peek at early results from its early stage clinical study of CTX110 in treating B-cell malignancies in 2020 as well. CTX110 is the biotech’s first allogeneic chimeric antigen receptor T-cell (CAR-T) therapy to be tested in humans. Allogeneic CAR-T therapies could be game-changers in treating blood cancers. Current CAR-T therapies require a patient’s own T-cells to be genetically modified at an off-site lab, which involves several weeks and is very expensive. Allogeneic CAR-T therapies, sometimes referred to as “off-the-shelf” therapies, use healthy donors’ T-cells and can be administered quickly and should be much less costly.

So far, we’ve only discussed ex vivo CRISPR therapies where cells are genetically edited outside of patients’ bodies then administered via infusion. A major milestone should also be achieved with the first-ever in vivo (in the body) dosing of a CRISPR gene-editing therapy likely on the way in early 2020. Editas Medicine has already screened the first potential patients with Leber congenital amaurosis type 10 (LCA 10), the leading genetic cause of blindness, that could be treated with EDIT-101, a CRISPR therapy that is administered through an injection in the eye.

Expanding targets

In addition to the clinical studies currently in progress, look for new clinical trials that use CRISPR gene editing in other therapeutic targets next year. CRISPR Therapeutics plans to initiate an early stage clinical study in the first half of 2020 evaluating its second allogeneic CAR-T therapy, CTX120, in treating multiple myeloma.

Editas expects to provide data to its partner Allergan (NYSE:AGN) by the end of 2019 related to its next potential clinical candidate targeting Usher syndrome type 2a (USH2A), which, like LCA 10, is a rare genetic eye disease. Allergan has the right to opt in on that program. Whether with Allergan’s participation or not, Editas could file sometime next year for FDA approval to begin its second clinical study of a CRISPR therapy.

Intellia Therapeutics should take a big step next year as well. The company anticipates filing for FDA approval by the middle of 2020 to begin a clinical study evaluating CRISPR therapy NTLA-2001 in treating rare genetic disease transthyretin amyloidosis.

Potential investing strategies

There are several ways that investors could profit from what should be the biggest year yet for CRISPR gene-editing stocks:

  • Buy shares of one or more CRISPR-focused biotech stocks.
  • Buy shares of one or more of the major partners of the CRISPR-focused biotech stocks.
  • Buy shares of an exchange-traded fund (ETF).

Option 1 provides the greatest potential for big gains, followed by option 2 then option 3. However, investing in biotech stocks, regardless of which alternative you use, comes with risks — especially the risk of clinical failure. Option 1 involves the greatest risk, with options 2 and 3 offering less risk.

Investors who like option 1 will probably want to put CRISPR Therapeutics and Editas Medicine at the top of the list, since both biotechs are ahead of Intellia in pipeline development.

Major partners for option 2 include Vertex, Allergan, Bayer (which, like Vertex, partners with CRISPR Therapeutics and owns a stake in the company), Bristol-Myers Squibb (which thanks to its acquisition of Celgene is a partner with Editas), and Regeneron (which partners with Intellia). You could also throw AbbVie into the mix, since it’s in the process of acquiring Allergan. Vertex probably offers the greatest growth prospects with its strong cystic fibrosis franchise.

For option 3, the SPDR S&P Biotech ETF’s holdings include Editas, Intellia, Vertex, Regeneron, and AbbVie. Also, the iShares Nasdaq Biotechnology ETF owns shares of CRISPR Therapeutics, Editas, Intellia, Vertex, and Regeneron.

I’ve taken an “all of the above” approach, owning shares of a CRISPR-focused biotech, three major partners of CRISPR-focused biotechs, and one of the top biotech ETFs. My view is that 2020 will be the biggest year thus far for CRISPR gene-editing stocks but also a very good year for biotech stocks, in general.

Author: Keith Speights

Source: Fool: Why 2020 Should Be the Biggest Year Yet for CRISPR Gene-Editing Stocks

Don’t totally write off the chances that the MORE Act or similar legislation could become law in the not-too-distant future.

Arguably the biggest legislative milestone to date related to the legalization of marijuana in the U.S. was achieved two weeks ago. The U.S. House of Representatives Judiciary Committee voted 24 to 10 to pass the Marijuana Opportunity Reinvestment and Expungement (MORE) Act, a bill that would legalize marijuana at the federal level.

Marijuana stocks soared after the historic vote. But the initial euphoria faded as investors realized the challenges that lie ahead. Will marijuana actually become legal in the U.S., and by when? Here are three scenarios where the U.S. could legalize pot by 2021 and perhaps even sooner.

1. McConnell allows the Senate to vote on the MORE Act

Passage of the MORE Act by the full House of Representatives seems assured. It’s a much different story in the U.S. Senate, though. Senate Majority Leader Mitch McConnell (R.-Ky.) has been adamantly opposed to the legalization of marijuana in the past. If he doesn’t want a bill to come before the Senate, it won’t.

Could McConnell change his mind? Probably not, but there’s at least a remote possibility that he could. His No. 1 priority is ensuring that the GOP retains control of the Senate in the 2020 elections. If he thinks that allowing the MORE Act to advance through the Senate will significantly improve the odds of Republicans holding onto the Senate, look for the legislation to go to the Senate Judiciary Committee and ultimately be voted on (and probably passed) by the full Senate.

At this point, it looks like the GOP will lose three Senate seats but still end up controlling at least 50 seats after next year’s elections. However, if the political winds shift in a way that makes the toss-up seat in Colorado (which claims one of the largest recreational marijuana markets) crucial to retaining a Senate majority, McConnell could decide that allowing a vote on the MORE Act is necessary.

2. Democrats gain control of both congressional chambers next year

Another scenario that’s favorable to marijuana legalization in the U.S. is one in which the Democrats win both the House and the Senate in the 2020 elections. Based on current projections, retaining control of the House seems likely. Picking off enough votes for Democrats to gain a majority in the Senate is a much tougher challenge.

Still, anything can happen in an election year. Although the prospects that the GOP will lose control of the Senate don’t seem great right now, there’s a long way until election day. The U.S. economy could tank. Momentum for impeaching the president could pick up and swing some Senate seats to the Democrat column.

Of course, the MORE Act (or something similar) would have to start from scratch in a new congress. But if Democrats control both congressional chambers in 2021, look for swift movement to legalize marijuana at the federal level. Would the president — whoever he or she might be — sign a marijuana legalization bill into law? With strong public support of legalization among Americans, it seems unlikely that any of the current Democrat presidential candidates or President Trump would veto the legislation.

The bigger challenge would be in the timing. It could be a stretch for both the House and Senate to pass a bill and the president sign the bill into law quickly enough for legalization to go into effect before the end of 2021. It’s not impossible, though: The 2018 Farm Bill passed in December 2018 legalized hemp throughout the U.S. immediately.

3. McConnell is replaced as Senate majority leader

There’s one other scenario that could pave the way for U.S. legalization of marijuana: the replacement of McConnell as Senate majority leader with someone more supportive of legalizing pot. Of course, this would happen by default if the Democrats win control of the Senate after the 2020 elections. But there are also other ways it could happen.

McConnell will be 78 in February. Should he have serious health problems, he could opt to step down from his position as majority leader. To be clear, though, this would be a highly unlikely event. McConnell has had some health problems in the past, including a fractured shoulder resulting from a fall earlier this year, but nothing that would cause him to either resign from the Senate or from his position as majority leader.

Barring a serious health problem, it would probably take a major political crisis to cause McConnell to either voluntarily relinquish his top spot in the Senate or be pushed out of the role. But if the GOP retains control of the Senate, don’t expect Republicans to be eager to replace the person who helped guide the party to victory.

Implications for investors

With the seemingly slim prospects for U.S. marijuana legalization in the near future, what should investors wanting to profit from marijuana stocks do? Think broadly and think long term.

Thinking broadly means don’t just limit your investing universe to the well-known Canadian cannabis stocks. Sure, Canopy Growth (NYSE:CGC) would benefit tremendously from U.S. marijuana legalization with its deal to acquire U.S.-based Acreage Holdings waiting only for the green light to go. But there are many U.S.-based stocks that can win regardless of what happens with efforts to legalize pot.

Innovative Industrial Properties (NYSE:IIPR) especially stands out. The company provides real estate capital to U.S. cannabis operators. Even if marijuana remains illegal at the federal level in the U.S., IIP should continue to be attractive to companies seeking to expand in the U.S. cannabis market.

Also, investors who think long term won’t be overly concerned if U.S. marijuana legalization doesn’t happen in the next couple of years. Most observers think it’s a matter of when and not if federal laws prohibiting marijuana will be changed. If you have an investing horizon of 10 years or more, you’ll be content knowing that there will be a lot more opportunities ahead for marijuana stocks than the MORE Act.

Author: Keith Speights

Source: Fool: 3 Scenarios for U.S. Marijuana Legalization by 2021

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