Photo: Kym Mackinnon via Unsplash

Tilray Inc (Nasdaq: TLRY) shares are trading higher Tuesday, moving alongside other popular cannabis names. The overall sector is moving higher as continued optimism on cannabis legalization is possibly a factor.

Tilray was up 4.27% at $13.69 at last check Tuesday afternoon.

Tilray Daily Chart Analysis

• Shares have been falling and look like they could be ready to start turning around if they are able to break out of what technical traders call a falling wedge pattern.
• The stock has been getting condensed between narrowing highs and lows and is now nearing the point in the wedge. A break above either pattern support or resistance could let the price breakout in the pattern continuing in the direction of the break.
• 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.
• Each of these moving averages may hold as a possible area of resistance in the future.
• The Relative Strength Index (RSI) has been moving higher the past couple of weeks and now sits at the 47 level. The move higher shows there have been more buyers pushing in the stock and that there are now almost equivalent buyers and sellers.

(Click on image to enlarge)

What’s Next For Tilray?

Bullish traders would like to see the stock cross above the pattern resistance and push higher. Bulls would then like to see the stock consolidate while holding the gains it made from the breakout for a possible next leg up.

Bears would like to see the stock drop below the pattern support and start to move lower. If the stock can hold the pattern support as a resistance level, it may signal the stock is ready to see another push lower.