Biotechs have been on a roll lately, and GW Pharma is sitting on top. Long noted as a player in the cannabis space, this volatile name has vaulted higher after getting pounded at the end of 2018. Volume has returned with the buying frenzy, and now the stock has run into some heavy resistance. The November highs are being challenged, which will not be easy to surpass.

We could see a bit of sideways action soon. The 200 ma (arrows) has held on multiple occasions and offers good support. Notice the widening cloud, which indicates an expanded price range is likely. Momentum indicators and the large cup/handle pattern are bullish. If you bought last week (lower arrow), you bought at the right time. Remember, the best trends barely give you a chance to get in, and it is true with this name.

I expect this stock to push through the old highs before too long.

Take a deeper dive into the chart action of GW Pharma on Nasdaq: GWPH and learn how to read the technicals. Get Bob Lang’s full analysis as he marks up our chart of the week.