Organigram Stock Breaks Out, Higher Prices Anticipated

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OGRMF Stock: Marijuana Stocks Are Back in Vogue

All of a sudden, the marijuana sector has caught a bid after a slow summer. A number of stocks in this sector have begun to break out and Organigram Holdings Inc (CVE:OGI, OTC:OGRMF) stock is no exception. Organigram stock has just completed a powerful technical price pattern, which is now suggesting that higher OGRMF stock prices are expected to follow.

I highlighted OGRMF stock on August 18 in a publication titled “A Powerful Move in Organigram Stock Is Brewing.” In that publication, I outlined that a powerful price pattern was in development and that the odds favored a bullish resolution of the price pattern because the predominant trend towards higher stock prices was firmly intact.

The following Organigram stock chart illustrates the predominant bullish trend and the metric that defines it.

OGRMF Stock Chart

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Chart courtesy of StockCharts.com

This OGRMF stock chart illustrates a simple tool that was used to define its predominant bullish trend, one that contains the quintessential characteristic that defines all bullish trends, which is a stair-step pattern consisting of a series of higher highs and higher lows.

The uptrend line that defines this bullish trend was created by connecting the series of lows. The number of times that Organigram stock tested this uptrend line is a testament to its significance. I can easily assume that as long as the share price is trading above this uptrend line, the bull market in OGRMF stock is still in development.

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The technical price pattern that was suggesting a powerful move was in the making was developing right above this uptrend line. This is why I was so excited about the prospects of this investment heading forward.

The technical price pattern that was suggesting a powerful move was in the making was developing right above this uptrend line. This is why I was so excited about the prospects of this investment heading forward.

The following OGRMF stock chart illustrates the technical price pattern that was suggesting that a powerful move was in the making.

Organigram price chart

Chart courtesy of StockCharts.com

This Organigram stock chart highlights the development and completion of a symmetrical triangle. This pattern is a result of the price action creating a series of higher lows and lower highs. This pattern is defined by using two converging trend lines that represent respective levels of price support and price resistance.

Triangle patterns are particularly powerful price patterns. The power generated by these triangles is a result of momentum being built and stored within the pattern as it develops.

As the pattern develops, the range between support and resistance continues to contract. Each and every time the stock price gets rejected by a level of support or resistance, momentum is being stored within the pattern. This built-up momentum is finally released when the stock price breaks above resistance or below support.

The size and scope of the pattern is directly related to the size and scope of the reaction that is expected to occur once the pattern is resolved. The symmetrical triangle that is painted on the Organigram stock chart is not small by any means and therefore a fairly large reaction is expected to occur once the pattern is resolved

On September 18, Organigram shares exited the symmetrical triangle in an upward direction and this feat is highlighted on the stock chart as a breakout. The breakout implies that an accelerated trend towards higher stock prices is now in development.

This bullish view is being reinforced by the moving average convergence/divergence (MACD) indicator. MACD is momentum indicator that is used to determine whether bullish or bearish momentum is influencing the stock price.

A bullish MACD cross implies that bullish momentum is influencing the stock price. Therefore, OGRMF is geared towards higher stock prices because that is the path of least resistance.

This confluence of indications is suggesting that higher OGRMF stock prices are now on the horizon, and a challenge of the previous all-time high at $3.35 is something that can now be anticipated.

Analyst Take: 

Organigram stock has just completed a technical price pattern that is suggesting that much higher stock prices are on the horizon. The bullish posturing of OGRMF stock and a key momentum indicator are supporting this notion.

This bullish view was generated by analyzing the price action and internal indicators on the company’s stock chart, and until there are indications supporting another view, I will remain bullish on this investment.