Tilray Stock Breaks Below Pattern: What's Next For The Cannabis Stock?

Tilray Inc. TLRY shares ended Thursday's session higher in a reversal after the cannabis company posted worse-than-expected earnings.

The company said its first-quarter net loss increased to $34.6 million, or 8 cents per share, from a loss of $21.7 million, or 9 cents per share, from the year ago period.

Tilray was up 2.13% at $11.02 at the close. 

Tilray Daily Chart Analysis

• Shares have been dropping in the last few months in what technical traders call a falling wedge pattern. The price looks to have possibly fallen out of the bottom of the pattern.
• Narrowing highs and lows have pinched the stock between support and resistance. With the fall out of the bottom of the pattern the stock, it's possible it sees a further push.
• The stock is trading below both the 50-day moving average (green) and the 200-day moving average (blue), indicating sentiment in the stock has been bearish.
• The stock may find resistance near either of these moving averages in the future.
• The Relative Strength Index (RSI) has been trading sideways below the middle line and sits at 40. This shows that there’s been more selling pressure in the stock than buying pressure.

See Related: Why Tilray Shares Are Falling

What’s Next For Tilray?

Bullish traders are looking to see the stock turn around and cross back above the pattern support. This would show the stock has some life in it. If the stock can cross above the support, bulls would then like to see the stock form higher lows and start pushing upward.

Bears are looking to see the stock start to hold the pattern support as an area of resistance before possibly making a strong push downward. Bears have been in control of the stock for the last few months and are hoping to keep it that way.