MedReleaf Corp (TSE:LEAF) (OTCMKTS:MEDFF) is on quite the winning streak. The company is again showing why it is, bar-none, the strongest and most technically sound Canadian cannabis stock in the market today.

MedReleaf is currently trading higher by $0.69 to $21.75/share (↑3.28%) on higher than average volume. This, despite a broad-based cannabis sector decline of nearly two percent. LEAF’s strong price action continues a recent trend of out-performance vis-à-vis its peers, which are mostly mired in a negative technical morass. In fact, it MedReleaf is the strongest marijuana stock in Canada today (as of 1:00pm):

Company Closing Price Loss/Gain % Loss/Gain Volume MedReleaf Corp. 21.76 0.7 3.32% 392.63k Cannabix Technologies Inc 1.9 0.05 2.70% 141.49k CannTrust Holdings Inc. 7.15 0.17 2.44% 127.11k Hiku Brands Company Ltd. 1.47 0.03 2.08% 193.51k Maricann Group Inc. 1.61 0.01 0.63% 429.01k

Perhaps just as significantly, the recent price action has vaulted MedReleaf into No. 3 position among Canada’s most capitalized cannabis companies. At $2.2 billion dollars, the company overtakes Aphria Inc. ($2.05 billion) for those bragging rights. This has materialized after a huge run, which has seen MedReleaf soar an astounding ↑48.23%, peak-to-trough, since April 10.

Company Market Cap (Top 5) Canopy Growth Corporation 5.84b Aurora Cannabis Inc. 4.42b MedReleaf Corp. 2.20b Aphria Inc. 2.05b Cronos Group Inc. 1.10b

The continued strength (and subsequent breakout) should come as no surprise to regular Midas Letter readers. On April 25, we alerted our base to the possibility of technical breakout and disconnection with the market at-large:

MedReleaf Corp is firing on all cylinders—from a price action perspective. The medical marijuana premium products provider and LP is currently immersed in a very pronounced reverse correlation between its share price and the sector at-large. Should trends continue, LEAF could be on the precipice of a significant move higher.

Self-congratulations aside, the focus now shifts on how far this extension might go. While this won’t much interest the heavy institutional buy-and-hold crowd, momentum traders and retail investors angling for price points may take heed. MedReleaf’s resilience and leadership qualities are fostering growing participation across the investing spectrum.

Looking at the chart in totality, some interesting patterns emerge. Setting aside the usual technical indicators for a moment, some distinct patterns emerge. It seems as though second ancillary moves usually run in rough proportion to the original breakout/breakdown. Here’s what this looks like graphically:

Of course, this is a simplistic way to trying to decipher the price action. The institutions trading the stock use more sophisticated technical and peer analysis to decipher ultimate valuation levels. We understand that.

However, there’s no mistaking that trends also play a sizable role in ultimate price action conclusions. Depending on how much weight is afforded to the recent past, we posit MedReleaf could reach somewhere in the $25-26/share range before significant pullback takes place. This would take prices at or through the January 2018 bounce-back channel, where prices consolidated for 10-days before embarking on another nasty stretch lower.

Again, that’s just a educated guess. As MedReleaf has partly uncorrelated itself from the rest of the sector, it’s difficult to determine whether relative strength will keep going or fall in-line relatively soon. Many factors will decided the near-term picture, but investors are sure to enjoy the party while it lasts.

MedReleaf Corp. CEO Neil Closner talks to James about future plans in light of the recent $100 million financing, including expansion and distribution. He also sheds light on how the company remains consistent with the high quality of their products in comparison to competition.