Canadian CANNAINVESTOR Magazine May / June 2018 | Page 220

220

Hiku Brands Company Ltd.

(CSE: HIKU)

(note: the chart uses OTC: DJACF, same company)

Note: the chart uses

OTC: DJACF, same company

Hiku Brands is a company that consists of a portfolio of cannabis brands such as Tokyo Smoke, Doja, and Van der Pop. And in this session, we will discuss another tool you can add to your portfolio of technical indicators. Just as Hiku is a diversified company, we have one more tool for your toolkit that will help you rake in the gains.

Have you ever heard people mention that a stock is oversold or overbought? Chance are they are talking about the relative strength index (RSI). The RSI is a technical indicator we can use to help us find areas where stock appears to be oversold or overbought. There are times where these circumstances make sense, however, if there are no changes in the underlying company or sector then we can use the RSI to our advantage to find more opportune times to buy and sell when combined with our other indicators. The RSI calculation is derived from a formula that composes the average gain and loss. What you want to know is how to use it. When the RSI breaks above 70 it is considered overbought and is an area where you would consider selling or at least not an ideal time to consider buying. On the flip side, if the RSI falls below 3o then the opposite is true. Note that just because it breaches into oversold or overbought does not mean it will bounce back right away. It is best to be on guard when this happens and wait for some other signals to align or for the RSI to begin to turn back towards the middle. I sense relatively strong gains in your future if you incorporate this technical indicator into your toolbelt.