Good Tuesday afternoon everybody. Buckle up. We've got a lot to get through today, so we're just going to dive straight in beginning with the most important item... big news from Namaste Technologies (OTCMKTS:NXTTF, CNSX:N).
Cutting to the chase, Namaste Technologies -- which sells marijuana vaporizers -- can now list its wares at popular online-shopping site eBay (EBAY).
For those of you who've been following the advent of marijuana's legalization, you'll know this doesn't sound right -- eBay doesn't allow vaporizers, or "vapes," to be listed at the site. That was true until very recently. Now the online auction and shopping site is allowing some vendors to list their marijuana hardware in the newly-created "vaporizers and e-cigarettes" category.
We poked around a little, but we're still not clear about any rules the site may impose on these kinds of products. Though the devices themselves shouldn't be illegal anywhere, given the nature of what they do, this seems like it's being treated as something of a gray area. As we've said several times already though, marijuana's legalization is a process rather than an event. The fact that Namaste's vaporizers are being listed at all is a step forward.
We're just excited Namaste Technologies is in position to establish a strong presence at eBay. The word is, eBay is being picky about who it lets list vapes.
Oh, and as for just how much bigger the opportunity got now that NXTTF (or N, for Canadian investors), eBay serves as the middleman for more than $80 billion worth of e-commerce every year. Meanwhile, vaporizers are estimated to be an industry worth $2 billion per year. Namaste Technologies is setting up shop right in the middle of where those two markets intersect. That's an enviable position to be in.
Tuesday was also a big day for Lexaria Bioscience (OTCMKTS:LXRP).
Remember a week ago when Lexaria (the company that improves the bioavailability/absorbability of hemp oil) announced it was teaming up with NeutriSci International (CVE:NU) to make a new health supplement that combines the antioxidant pterostilbene with its own proprietary hemp oil? As we mentioned then, that was apt to be the shape of things to come. That theory was proven today, when Lexaria Bioscience announced another partnership that leverages its science with someone else's brand name and distribution network.
The newest partner is Canadian specialty food company Hempco Food and Fiber (CVE:HEMP). Hempco makes hemp protein powder, bulk hulled hemp seed, and hemp seed oil. With Lexaria's infused hemp oil though, a good product line from Hempco is made even better.
As a reminder, Lexaria Bioscience's claim to fame is a proprietary process that drastically improves how much of the good stuff in hemp oil is absorbed into the body by those consumers who use it.
In short, Lexaria has developed a process that makes valuable molecules taste better and absorb better in the digestive tract. This platform could be applied to a variety of nutritional and health-oriented favorites, but Lexaria is starting with hemp as it's the most underserved market and arguably the biggest growth opportunity.
Two different studies have been done to support the claim. The first study -- a third party review and in-vitro assessment of cannabidiol (CBD) bioabsorption done late last year -- indicated up to a 499% improvement in absorption compared to what was currently achievable. The second study performed earlier this year was a human clinical trial of nitric oxide induction. This study demonstrated potent CBD bioabsorption in humans using a nitricoxide salivary biomarker test. All subjects demonstrated rapid, significant and sustained increase in salivary nitric oxide levels (a 500%-1000% increase) following product ingestion, verifying the company's ViPova(tm) brand of teas, coffee and hot chocolate as well as its Lexaria Energy Foods Protein Bars could provide a superior hemp-usage experience.
Now Hempco Food and Fiber is going to benefit from that science, but that also means high-margin licensing revenue for Lexaria Bioscience.
On other fronts, did everybody see the pullbacks we saw from the U.S. dollar and interest rates today? We had a pretty good feeling the bulls overshot earlier in the month, but today's downside follow-through from yesterday's dip pretty much seals the deal.
Just for a little perspective on how far yields raced out of control though, let's take a step back and look at a weekly chart of long-term rates and long-term treasuries. They started the month out already pushing their luck, but went hog-wild in the aftermath of Trump's victory.
The shape of the rate chart and the treasury chart both scream reversal too... a nice V-shaped pivot with lots of room and reason to keep moving in their new direction.
This shift affects gold, or course - a theme we brought up late last week. We've been calling for gold's bounce for a few days now, and though it was late getting started, the yields/bonds action should help gold's rally get going.... and it was already in a good position to do so.
The chart of the SPDR Gold Trust ETF (GLD) below is an updated version of one we looked at a week ago. We mentioned then how GLD was approaching a key pivot level in the form of a 62% Fibonacci retracement line. Well, the ETF pretty much kissed that floor on Friday, and like clockwork started to reach for higher highs again. It's been a bit of a process, but things are starting to gel with our theory.
Now, there are lot of ways to make a play on gold. If you're getting anxious to do so though, we'll just say be sure to check your e-mail shortly after the open on Wednesday. We've got a new trading idea coming your way that's highly-levered to gold's price, and yet it's anything but a conventional gold miner. We think you're going to love its business model.
Talk to you then.