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Tobacco Stocks & Sector Analysis

The tobacco stocks got smoked on Friday & member @stock51 in the trading room has asked me to take a look at the sector following last week's carnage in many of those stocks to share my thoughts. Starting with the tobacco sector, we can see that the recent 13% correction was far from unexpected as the charts were clearly bearish. The tobacco sector printed a divergent high on the peak back in mid-June. Friday's meltdown, although I'd imagine there was most likely a news and/or earnings-driven catalyst assigned to it, was also triggered by a significant technical catalyst; a breakdown below the primary uptrend line off the November 2016 lows. As of now, the tobacco sector sits just below a former support, now resistance level. As such, until & unless that level is...