Cannabix Technologies Inc (OTCMKTS:BLOZF) poor run in the market is slowly coming to an end if recent price action activity is anything to go by. After shedding more than 70% in market value in 2018, the stock appears to have turned the page having bounced back from one-year lows. However, the big question remains, does the stock have what it takes to continue powering higher?
Cannabis Technologies Price Analysis
For the stock to continue climbing the ladder, Cannabix Technologies will have to do a better job on the news release front. The management needs to come out and reiterate the company’s outlook especially on the development of the company’s flagship product, Marijuana Breathalyzer.
Investor sentiments in the stock are still at an all-time low, despite the stock showing signs of resurgence. After the recent spike higher, the stock is staring at a key resistance level at the $1.80 level. For the stock to turn bullish after the underperformance of 2018, it will have to rally and stabilize above the $2 a share level.
Above the $2 a share level, bulls could have a reason to come back in and participate in pushing the stock back to its 52-week highs of $2.88. Below the $1.80 level, Cannabix Technologies remains susceptible to further drops given the underlining long-term downtrend as well as the fact that short sellers remain in firm control.
What Does Cannabix Technologies Do?
Cannabix Technologies casts itself as a developer of marijuana Breathalyzer for law enforcement. The company develops drug-testing devices for detecting tetrahydrocannabinol using breath samples. Its devices can be used to detect people driving while under the influence of marijuana.
Improving Operational Efficiency
Trading activity around Cannabix Technologies appears to have picked pace on the management stating they have made important strides in the development of a marijuana Breathalyzer. For starters, the team has confirmed engaging a leading engineering and design firm in developing a handheld breath collection device for its marijuana Breathalyzer unit.
MistyWest Engineering is the firm that has already begun working on the proposed portable handheld marijuana detection device
“The engineers at MistyWest have a lot of experience with human factor design and creating these kinds of devices efficiently. This will integrate with our added capacity for gas analysis using our new state of the art equipment at our Florida facility,” said Dr. Raj Attariwala.
In addition, Cannabix Technologies has expanded its lab space in Florida that will go a long way in supporting its efforts on the production front. The company has also acquired a new Thermo Scientific GC mass spectrometer designed to analyze breath samples.
Development of a handheld marijuana Breathalyzer could not have come at a better time for the company. Canada has already legalized recreational use of marijuana, a development poised to create a substantial market for the company’s devices.
The legalization is a watershed moment given that there will need to enhance public safety on the roads by ensuring people do not drive under the influence of Marijuana. That said the company’s devices should elicit strong interest especially from law enforcement agencies looking to ensure public safety on the roads.
“Cannabix applauds the significant efforts that are underway by the Government of Canada and others to increase public awareness of the dangers of drugged driving on our roadways and the acute problems of being under the influence of drugs in the workplace,” Cannabix Technologies in a statement.
The company is in the process of accelerating its research and development efforts all in the effort of helping the government and the general public transition to marijuana legalization. The company is well funded to come up with a Breathalyzer that will be of great help in helping determine impairment on the roads in case of marijuana use.
Cannabix Technologies had one of the worst runs in 2018 that saw it shed more than 70% in market value. However, recreational use has created a new opportunity that strengthened the company’s growth prospects.
The company has already achieved significant strides in coming up with a marijuana Breathalyzer that will be a crucial driver of value as law enforcement agencies seek to ensure people don’t hit the roads while under the influence.
That said 2019 could turn out to be a pivotal year, on the company coming through with a reliable portable marijuana Breathalyzer. The stock should continue trading higher on management reaffirming development of the proposed Breathalyzer.
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Disclosure: We have no position in BLOZF and have not been compensated for this article.