ACB Stock Price: Aurora Cannabis inc may rise as coronavirus fears may trigger recession
|- Aurora Cannabis stocks are sliding along with broader markets.
- A recession may eventually benefit marijuana stocks.
- Monday's four-hour chart is pointing to moderate declines below $2.40 resistance.
Stock markets are taking the recent coronavirus news from Italy on the chin. The sizeable European country reported a substantial cluster of cases and seven deaths, exacerbating market fears. Investors are concerned with the economic impact of even cancelations and plant shutdowns in Europe and in Asia.
Aurora Cannabis is not immune to the general market sell-off and is now trading around C$2.13, down 3.85%, in line with broader markets. The Edmonton-based firm has suffered major unrelated drops in revenue, the ouster of its CEO, and impairment charges.
The coronavirus – and mostly fears related to it – may trigger a recession in various countries. While a downturn leaves fewer dollars' of disposable income for recreational drugs, it also elevates the need for conscience-alleviating substances. Those that are in financial distress may turn to weed to divert attention from their troubles. This may affect sales in North America and beyond.
Shares of pot stocks have room to run higher – assuming they get things right. Will Aurora be one of those companies to come stronger out of an economic slump? That remains an open question.
Aurora Cannabis Stock Price
The four TSX: ACB chart is pointing to upside momentum for the stock price despite edging lower. On the other hand, the picture remains bearish as long as it trades below 2.40, which has initially worked as support and then as resistance. Moreover, it is where the 50 Simple Moving Average hits the price.
Support awaits at $1.90, the all-time low and above $2.40, the next cap is at $3.05.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.