Tilray Inc. (TLRY) shares are trading lower on Thursday and are continuing the downward trend the stock has been on. Tilray announced this morning that it would be entering a strategic partnership with HEXO Corp (HEXO), which includes a new debt financing agreement. Under the new agreement, Tilray will acquire $211 million of senior secured convertible notes that were originally issued by HEXO.

Tilray was down 6.17% at around $5.48 at the time of publication.

Tilray Daily Chart Analysis

The stock has been trading in what traders call a falling wedge pattern. This pattern forms when the stock is in a downward trend but the highs are falling at a steeper rate than the lows. The stock is sitting in the middle of the pattern and it would need to cross above resistance to see a bullish reversal. But until that happens, the stock may continue to fall lower in the pattern.

The stock has been trading below both the 50-day moving average (green) and the 200-day moving average (blue). This indicates bearish sentiment, and each of these moving averages may hold as an area of resistance in the future.

The Relative Strength Index (RSI) has been falling lower the past couple of weeks and it now sits around at 37. This shows that more sellers have been moving into the stock and pushing the price lower. If the RSI continues to stay below the middle line, the stock may keep seeing selling pressure.

What’s Next For Tilray?

Tilray appears like it will continue to fall in the wedge pattern, and it has been in the bearish trend since mid-2021. Unless the RSI can cross back above the middle line or the stock can cross above the resistance level, the stock will most likely continue to see a bearish downward trend.

Bullish traders are looking for higher lows to form and for the RSI to hold above the middle line. Bears are in control of the stock and would like the RSI to continue to stay low and the price to hold below the moving averages.