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Amazon endorses cannabis legalization, TLRY rallies

Shares of Tilray were up higher as cannabis-related news flooded the market. Can TLRY have a similar move to AMC?

Lucifer Morningstar

Shares of Tilray (TLRY) were 11.9% higher on Tuesday after Amazon announced that it will support the federal legalization of weed. The company states that it won't be testing prospective employees for marijuana, and instead will treat it the same as alcohol consumption. Office parties are about to get much more lax.

Cannabis stocks soared on that news. Why does this matter? TLRY hit sixty not too long ago, and with this crazy "short squeeze" theme this creates an opportunity to buy. I mean if you want, since I don't care what you do with your money *wink*.

Chart, Option Activity, Headline

via cheddarflow

It looks like a lot of big buyers are coming for TLRY calls. On the 25 calls that expire on 6/25, you will see that volume at 1,855 far outweigh the open interest of 479. This may mean that someone could be accumulating contracts because volume indicates strength.

According to Marketwatch (full article here)

"Cannabis stocks were mostly higher Tuesday after three Democratic senators led by Majority Leader Chuck Schumer said they would make reform legislation a key priority in the current Congress, bolstering hopes for an end to federal prohibition."

“With cannabis legalization having overwhelming public bipartisan support, many Republican states already legalizing cannabis, potential tax revenue, and Schumer last week saying the newly planned bill already has support from ‘some Republicans,’ we think (there’s) a strong chance of (it) advancing to Biden’s desk."

TLRY is also heavily shorted. If we have continued momentum from these short squeezes happening, then I think TLRY has a good shot to move higher past 25.

This isn't a stock we're at the bottom at, that was a few weeks ago in the teens (around 15) so mind your risk. If momentum continues on AMC and the meme stocks, TLRY can shoot up higher. If it doesn't work out, new phone who dis?

via tenor images

*Not financial advice.