Canopy Growth Stock Heads Toward Resistance: What's Next?

Canopy Growth Corp. CGC shares were trading higher Tuesday following an upgrade from MKM Partners.

The analyst firm upgraded the cannabis stock from Neutral to Buy and announced a CA$55 ($45.70) price target. 

On May 20, Canopy Growth announced that it had appointed Martha Stewart as the company’s official strategic advisor.

Canopy Growth was up 5.91% at $24.02 at last check.

Canopy Growth Daily Chart Analysis

• The stock is trading within previous key levels and is nearing a resistance level where the price once held as support.
• The stock is trading below both the 50-day moving average (green), and the 200-day moving average (blue), indicating the sentiment in the stock has been bearish.
• Both of these moving averages may hold as resistance in the future.

Key Canopy Growth Levels To Watch

• The stock looks to be trading within a sideways channel and is nearing resistance in the channel.
• The $25 price level is an area the price has previously held as both support and resistance. The stock is nearing this level once again, and a break above may hint the trend is turning bullish.
• The $20 level is an area the stock previously held as resistance, but this area may now hold as support as the price trades above it.

What’s Next?

Bullish technical traders would like to see the stock break above the $25 resistance and start moving higher. If the stock can continue to form higher lows on the daily chart, bulls will be in control.

Bearish technical traders would like to see the stock fall below the potential $20 support. Consolidation below this level may let the stock make a further push lower.