Global stock markets are all trading right at secular support. Stated differently, they are all at make-or-break levels. Similarly, the cannabis sector has arrived at a decision point. In order for our bullish Cannabis stocks canada forecast 2019 to materialize we must see a stabilization of the recent decline. We look at Canopy Growth, bellwether cannabis stock, to make the point that the cannabis stock sector will soon have a go or no-go for a 2019 bull market.
The cannabis stock sector lost 50% since October 12th, in just some 3 months time. That’s a serious crash, no matter how volatile this sector is. It is now underoing a critical test, and the Canopy Growth chart, symbol WEED.TO, makes our point clearly.
Its weekly chart is embedded below. The rising channel which started in 2016 has been tested several times, both at resistance but also at support.
Right now, the stock price of Canopy Growth, which we consider to be the bellwether stock in the cannabis stock sector, is back at support, for the 3d time in 3 years time.
The way we interpret this is simple: it is a go vs. no-go decision point. Bulls do not want to see a weekly close (Friday end of day) below the channel, certainly not more than 2 or 3 weeks in a row as it would invalidate the channel and likely delay the next bull market.
After such a sever decline, which did not happen often in the last 3 years, it makes sense that the decline stabilizes now. For sure if global stock markets would stabilize at this point it would be good news for the cannabis stock sector.
One thing is clear though: it is decision time, and investors know which decision point they have to watch!