Cannabis Stocks: MGW Stock Is Set to Soar Among Its Peers 
iStock.com/OlyaSolodenko MGW Stock: The Entire Marijuana Sector Is Making a Move
The year’s end is fast approaching and there is nothing as hot as marijuana stocks right at this moment. The moves in this sector this week have been awe-inspiring and as a result, people are clamoring for it in the hopes of getting aboard the next marijuana stock that is set to move.
This is why I am focusing on Maple Leaf Green World Inc
(OTCMKTS:MGWFF, CVE:MGW) stock. I have reason to believe that Maple Leaf Green World stock is on the verge of joining its peers by posting up exceptional performance numbers. My beliefs are centered around the price action on the MGW stock chart.
The following Maple Leaf Green World stock chart illustrates a completed technical price pattern, which is suggesting that higher stock prices are on the horizon.
Chart courtesy of StockCharts.com
The technical price pattern highlighted on the MGW stock chart is a descending channel. A descending channel is created when the price action is characterized by a uniform sequence of lower highs and lower lows.
Descending channels are best defined by using two downward-sloping parallel trend lines. These trend lines are created by connecting the uniform sequence of lower highs and lower lows.
While the descending channel is in development, these trend lines act like levels of price resistance and price support. A resolution of this pattern is dependent on whether the stock price breaks above resistance or falls below support. Such an event will dictate the next direction the stock price is set to take.
On November 13, Maple Leaf Green World stock broke above price resistance, which implies that the descending channel is complete and suggests that higher MGW stock prices are likely to follow.
The implications suggested by the descending channel are magnified when it is viewed in the context of constructive price action, which is highlighted on the following Maple Leaf Green World stock chart.
Chart courtesy of StockCharts.com
Constructive price action is a wave structure that consists of two predominant waves: an impulse wave and a consolidation wave.
The impulse waves are highlighted in green on the MGW stock chart and they capture the period in a bullish trend when the stock price makes a sustained move toward higher prices.
The consolidation waves are highlighted in purple on the MGW stock chart and they capture the period in a bullish trend when the stock price refrains from advancing and stages a correction. Price corrections are necessary within a bullish trend because they alleviate overbought conditions that were created in the impulse wave that preceded it. This sets the stage so a new advancing impulse wave can follow.
These waves work together in alternation to create and sustain a trend.
The descending channel doubles as a consolidation wave and now that it is complete, it suggests that a new advancing impulse wave is in development. Under this assumption, I have to believe that new highs are in order and it is only a matter of time before the highs established in October 2016 are overcome.
There is an influential momentum indicator on the verge of generating a bullish signal. This bullish signal will reinforce the notion of higher prices suggested by the alternating wave structure. This momentum indicator is highlighted on the following Maple Leaf Green World stock chart.
Chart courtesy of StockCharts.com
The focus of this MGW stock chart is the moving average convergence/divergence (MACD) indicator located in the lower panel.
MACD is a momentum indicator that determines whether bullish or bearish momentum is influencing the price action in a stock. This is a very influential indicator because a stock cannot make a sustained move toward higher prices without bullish momentum.
The MACD indicator is converging and come January 1, a bullish cross will be generated. A bullish MACD cross will suggest that the path of least resistance is geared toward higher prices, and it will set the tone in which Maple Leaf Green world stock can appreciate much like its peers.
Analyst Take
I am bullish on Maple Leaf Green World stock because I have reason to believe that higher prices are the horizon. These beliefs are based on the indications that have been generated on the MGW stock chart. Therefore, my bullish view is contingent on these indications remaining in bullish alignment.
Editor: Patrick Brik