Emerald Therapeutics (EMHTF), the 10 largest cannabis stocks by market cap, is a major Canadian cannabis grower. From December 2017 to February 2018, trading volume jumped as was the case with all cannabis stocks. Technically, this increase in trading volume and volatility resulted in movements that somehow form a Head & Shoulders pattern, a bearish pattern whose negative outlook seems consistent with the current price movements.
The short-term resistance seems consistent with the pattern’s neckline; April support matching those of December 2017 levels.
But how low might it break down should it violate support?
Here’s another technical view to consider:
The April and December lows sit between the 0.618 and 0.786 range of a Fib retracement. For some traders, 0.75 is the bearish “uncle point.” Given this reading, and that fact that support lay within that range, we can assume that traders/investors may be eying that range as a good buying opportunity; the relatively increased buying volumes attesting to that possibility.
The risk of loss in the trading of stocks, options, futures, foreign exchanges, foreign equities, and bonds can be substantial and is not suitable for all investors. Trading on margin or the use of leverage is not suitable for all investors and losses exceeding your initial deposit is possible. Supporting documentation is available upon request. Trading futures, options on futures, and foreign exchanges involves substantial risk of loss and is not suitable for all investors. Carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources and only risk capital should be used. Opinions, market data, and recommendations are subject to change at any time. The lower the margin used the higher the leverage and therefore increases your risk. Past performance is not necessarily indicative of future results.