ACB Stock Price: Aurora Cannabis inc may get carried higher by Canopy

Aurora Cannabis inc. has escaped the abyss. The Toronto-traded marijuana stocks hit record lows at C$1.90 but that was only two cents below the previous lows and from there, shares closed higher. At C$2.06, ACB seems to be finding its feet despite dismal results.

The Edmonton-based firm released its results for the quarter ending in December on Thursday and its adjusted EBITDA loss roughly doubled to around C$80 million. Nevertheless, shares stabilized as traders priced in the fall. One week earlier, ACB announced the departure of its CEO, impairment charges and its retreat from several markets.

Aurora's dire straits stand out against competition from Canopy. In its fiscal third quarter, Canopy beat expectations with a leap of 62% in its revenue from the previous quarter and announced the opening of 140 stores – while ACB is scaling back operations. Canopy Growth Corporation jumped into the German market which Aurora failed to enter. 

If Canopy can handle tough markets, can others follow its path? The market is still growing and after the battering, ACB's stock – as well as other pot shares – may get carried higher by Canopy.

It is essential to note that US traders are on holiday due to Presidents' Day and that may also be a positive factor. Quiet markets may allow for a calm reassessment of Aurora's situation and potential. 

Aurora Cannabis Stock Price

Monday's four-hour chart is showing that ACB still needs to recover the gap line at 2.40. The 50 Simple Moving Average also hits the price around that point. That would allow it to return the higher range that is capped by resistance at 3.05. The all-time low 1.90 remains critical support. 

There are a few technical worries for bulls. The Relative Strength Index is above 30 – outside oversold conditions – and allowing for further falls. Moreover, momentum remains to the downside.