Marijuana stocks’ performance is often subject to what is happening in the cannabis industry. In the last couple of years, the cannabis industry has seen significant change and innovation both in the U.S. and internationally.
Currently, more than half of U.S. states have legalized marijuana in some form, and the more legalization occurs, the more advancement can be had in the industry.
However, with the rise of inflation and disturbance that have hit the Nasdaq, pushing stocks officially into bear territory, marijuana stocks also lost a lot of ground. The three primary players on average lost 77% of their market cap in the last 12 months.
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Namely, Tilray Inc. (NASDAQ: TLRY), Aurora Cannabis (TSE: ACB), and Canopy Growth (NASDAQ: CGC), over the last 12 months, have lost 72.15%, 78.85%, and 84.60%, respectively.
TLRY chart and analysis
In the last month, technical analysis is showing TLRY has been trading in the $3.08 to $4.16 range, with a positive short-term trend. Recently, the price trend has been going up, with the support line at $3.31 and the resistance zone ranging from $4.04 to $4.09.
ACB chart and analysis
The short-term trend for ACB is neutral, while the long-term trend is negative. Currently, the stock is trading near the lows of its 52-week range, with a support zone between $1.39 and $1.40, while the resistance line is at $1.65.
CGC chart and analysis
Prices have been rising strongly lately, it may be a good idea to wait for a consolidation or pullback before considering an entry, with the short-term trend still remaining neutral.
In the last month, CGC has been trading between $2.13 and $3.17, with a support line at $2.45 and a resistance line at $3.06.
Due to the fact that the cannabis industry is still in its early stages of development and is still relatively young, the price action may provide investors with strong entry opportunities in which they may remain invested in the stocks for the long term.
The prevailing market downturn is enduring and is not confined solely to the cannabis cultivation sector. There has been a significant decline in sales of supplies for vertical farming in both the USA and the UK, indicative of a temporary halt in investment in new equipment by growers. Should this trend persist, only the preeminent players in the UK, such as Lumatek, Gavita, Nokatech, and Vivosun — renowned for their superior product quality — are likely to sustain their market position.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
