In our latest Trade To Black podcast presented by Flowhub, host Shadd Dales kicks off the week as rumors swirl out of Washington that a cannabis rescheduling recommendation from Administrative Law Judge Derek Julius could land any day. Trulieve (NYSE: TRLV) traded more than 12 million shares on Friday. Andrew O’Connell, author of the Pristine Capital Substack, returns to break down what it would take for a genuine gap up.
O’Connell notes it has been 27 days since the ALJ hearing transcript was released, a normal timeframe with nothing delayed. Anchoring a volume-weighted average price to August 2025, when Trump first promised a rescheduling decision, puts the average MSOS buyer at about $4.80. That is right where the ETF trades now, just under a heavy $5 call wall. He attributes Friday’s volume spike to triple witching, the second-largest options expiration on record.
We review how the sector has traded around past catalysts. The HHS recommendation sparked about 10 sessions of heavy buying before the gains reversed, and last year’s executive order produced a similar five-to-ten-day run. O’Connell argues this time is different. A positive recommendation could bring a DEA final rule 25 days later, followed by uplistings, all outside tax-loss harvesting season.
Options traders are stacking volume on the $5 strike for Friday, September 25, while open interest remains elevated on the October 16 $6 calls. With net gamma exposure near $1.9 million per 1% move, O’Connell estimates a 20% jump would force about $40 million in dealer buying to maintain hedges.
Trulieve faces resistance at $13 because it makes up roughly 30% of MSOS, which prompts routine trims by the fund. Its NYSE listing, alongside Glass House Brands (NYSE: GLAS), means ample liquidity this time around. With the Russell rank day on October 30, index inclusion could also bring passive buyers like Vanguard, BlackRock and State Street.
We close on Green Thumb’s newly authorized $50 million share buyback, about 3% of its $1.6 billion market cap, backed by $266.9 million in operating cash flow. O’Connell explains how buybacks lift earnings per share and says the sector’s best operators are finally positioned to go on offense. Stay tuned for his full take on what comes next.
