3 Reasons Cannabis Stocks May Be Headed Lower

The ETFMG Alternative Harvest ETF (NYSE: MJ) rebounded by 3.1% on Friday to around $25, but the find is still way off its February high of near $35. On Friday, DataTrek Research co-founder Jessica Rabe discussed what drove the early 2021 cannabis stock rally and three reasons why it has run out of steam in the past two weeks.

Blue Wave Rally: Rabe said headlines related to U.S. federal legalization of cannabis always trigger a rally in marijuana stocks, regardless of whether or not the reality of legalization is any closer. Democratic control of the White House and both houses of Congress following the November U.S. elections is the biggest driver of the huge rally in cannabis stocks.

Related Link: Cannabis Stock Short Sellers Have $4.3B In Losses So Far In 2021

In addition, Rabe said WallStreetBets and other online communities of young retail traders turned their attention to cannabis stocks after trading in GameStop Corp. (NYSE: GME) and other …

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