Although the calendar has turned over, the market is still dealing with a variety of end of the year reverberations. We see some delayed profit-taking in last year's winners by sellers who wanted to postpone tax consequences. SPACs are one group that is suffering today as they were some of the biggest winners last year.
There is plenty of choppy action as traders try to find the right themes and position for the new year. I'm looking at trades in both Bitcoin and cannabis this morning.
Bitcoin went nuts over the weekend, hitting an all-time high, and I'm playing it with the closed-end fund GBTC (GBTC) . Another play I have on the sector is Canaan (CAN) , a Chinese company involved in bitcoin mining. Traders are always looking for secondary plays on cryptos and have been focused on (MSTR) , (RIOT) , (MARA) , and a few others.
The cannabis sector is of interest due in part to the Georgia election on Tuesday. The think is that if the Democrats prevail, there will be a vote on the legalization of recreational pot. Rather than bet on the outcome of the election, my Stock of the Week is Cresco Labs (CRLBF) , which is primarily a wholesaler of medical cannabis. It stands to benefit no matter what happens in the election, and it also has a great looking chart.
It is slopping out there with many of the stocks that did well recently looking relatively poor. I believe that this shakeout may last a couple of days, and once we digest the election tomorrow, we should see some better setups develop. The key right now is to find the themes that are still working and watch out for the profit-taking in the big movers.