Tilray Stock Forecast: TLRY $6, $6.50 calls expiring on Friday jump 200%

• Tilray stock rose 6.8% on Tuesday and is up double digits in Wednesday's premarket.
• High level of call contracts expire this Friday.
• Tilray stock is down 23% so far this year and 76% in the past year.

Update: Tilray stock is trading up 4.2% at $5.92 about 45 minutes into Wednesday's session. Shares spiked up to $6.30 at the open but have steadily lost ground as the session has progressed. Due to the large-scale call buying that occurred on Tuesday, with some 30,000 contracts being traded that expire this Friday with strike prices of $6 and $6.50, Breaking above either of these levels will receive intent focus from the market. The cost of buying call contracts at those strikes – $6 and $6.50 – are up 175% and 216%, respectively, this morning.

Tilray Brands (TLRY), the massive Canadian cannabis conglomerate, is riding high in Wednesday's premarket. It appears that an unusually large volume of call options were purchased on Tuesday that is driving the price higher. Tilray stock saw a volume of 13,500 March 25 call contracts at the $6 strike price exchange hands and nearly 17,000 for the $6.50 strike. Both exceeded open interest. TLRY stock closed up 6.8% to $5.68 and up another 10% near $6.25 in Wednesday's premarket.

Tilray Brands Stock News: Despite dwindling share price, expansion continues

Similar to its Medmen deal last summer, Tilray announced earlier this month that it had acquired $211 million in convertible notes from Hexo, another major player in the Canadian cannabis arena. If exercised, Tilray would own about 37% of Hexo. This is unsurprising as Tilray has been on a mad tear to acquire as much of the pot industry as possible. Its deal with Medmen last summer gives it access to the US market, and its merger with Aphria around the same time created the largest cannabis company in the world.

Profitability is less important to management at this stage, since their stated goal is to raise current annual revenue of $600 million to $4 billion by 2024. Not much time left guys!

Tilray Brands Forecast: $6.23 is key

A descending top line that began one year ago back in March and connects to highs on June 9, 2021, and November 14, 2021, has been calling the resistance shots for a long time. Despite Tuesday's spike, shares are still down 76% in the past 12 months. To break out of the long-term bearish trend, TLRY needs to close above $6.75.

Resistance comes first at $6.23, where there was a shelf in late February. Then $7.30 shows resistance from the swing high in mid-February. Support is at $4.81.

TLRY 1-day chart