In general, the more times price tests a the more likely it is to fail, so the fact that CGC is testing this level again after a recent bounce from it this past November is not a good sign. The recent decline in price over the past two weeks can be attributed to overall equity market weakness due to coronavirus fears which is leading to a slowdown in total global economic activity, as well as CGC’s recent round of layoffs which saw 500 jobs lost with the closure of two facilities, and the shelving of plans for another facility which was in the works.
The Price Percent Oscillator below the chart is trending below its midline(0 level) and rolling over which indicates that price has negative momentum. The green line is close to crossing below its purple signal line which is a negative crossover and indication that a further decline in price is likely as negative momentum increases.
Based on the current price trend and global market selloff, the probability of CGC losing support at $15 is high which may result in a further -50% decline to sub $10 and back to levels not seen since 2017. Target area is $5-$10 shown in yellow.
Seeing as how CGC is the cannabis sector leader by market capitalization we can expect to see price weakness here spill over into the rest of the sector as traders look to CGC for signs of overall sector health.