Today, we're taking a look at stocks included in Jim Cramer's game plan for this week from a technical perspective. These are his "Mad Money" trading recommendations using their exclusive Stock Screener. You listened to him on "Mad Money" Friday or you read his views on these companies on Real Money, now here are the charts and indicators. Read Part 1, Part 2 and Part 3 of our series here.
No matter who wins the election, Jim Cramer says, there are ways to make money. Now let's take a closer look at the final four names on on Cramer's shopping list this week.
Ralph Lauren, as he is known today, attended Baruch College for a while. He did not finish, but I can guess he was not unlike many of the students I have taught at Baruch over the past 18 years. He came from an observant home, changed his name at some point, and was very driven to succeed. That is a bit of an over simplification but the typical Baruch student works part-time or full time and still tries to get out in four years. No silver spoons.
Today Ralph Lauren is the Executive Chairman and Chief Creative Officer of Ralph Lauren (RL) , the company he founded. He has done well for himself, but let's look at the charts of RL.
In this 12-month daily chart of RL, above, we can see prices hold between the 50-day and the 200-day moving averages. The daily On-Balance-Volume (OBV) line has been confined to a narrow sideways range since July. We know that people are buying and selling RL but the flat OBV line suggests that interest in the stock is pretty neutral.
The lower panel shows a small bullish divergence between lower price lows in September and October and higher lows from the momentum study. This divergence gives a slight upward bias to an otherwise neutral-looking chart.
This three-year weekly chart of RL, above, shows that prices are above the 40-week moving average line, which is still pointed down. The weekly OBV line is neutral and weekly Moving Average Convergence Divergence (MACD) oscillator is flat-lined on the zero line.
Strategy: If RL can rally and close above $110 the chart will be bullish and could support further gains toward $130 longer term. On the other hand, a decline back below $90 will mean a big base pattern will be playing out.
In this daily chart of J.C. Penney (JCP) , above, we can see some big swings in price -- up down up and down again. Taking the moving average crossover signals on JCP over the past eight months or so would probably have cost you money. JCP is up today but the 50-day and 200-day moving averages are about to cross for a bearish death cross.
The daily OBV line has been in a decline since mid-August suggesting continued liquidation. The momentum indicator has been rising the past two months as prices have fallen giving us a bullish divergence.
Like following moving average signals on the day chart, this weekly chart of JCP, above, shows a sideways trading range with no end in sight. JCP is below the 40-week moving average line. The OBV line is neutral to negative and the MACD oscillator is only a fraction above the zero line.
Strategy: The short-term trend on JCP is bearish and the longer-term trend is neutral. JCP has shown it can rally steeply but I don't anticipate a strong upside move at this point.
In this daily chart of Nvidia (NVDA) , above, we can see a strong uptrend in action. Prices are above the rising 50-day and 200-day moving averages. The OBV line has leveled off recently and the momentum has slowed. These clues are not sell signals but it may not hurt to raise your sell stops.
This weekly chart of NVDA, above, is pretty impressive, especially the rally since early 2015. NVDA is above the rising 40-week average line. The rising weekly OBV line confirms the price strength, but the MACD oscillator is close to a liquidate longs sell signal.
My strategy would be to raise sell stops to a close below $64 to lock in gains.
In this daily chart of Disney (DIS) , above, we see a small rounded bottom pattern playing out which could lead to an upside breakout on a weekly chart. Where is this rounded bottom? Prices decline in August and the gentle bottom action unfolds in September and October. Prices are now above the 50-day moving average line.
The OBV line has been steady the past two months and the momentum study has been rising. There is a fair amount of chart resistance above $95 but that could be overcome under the right circumstances.
This longer-term chart of DIS, above, shows Mickey at his worst. It looks like DIS made a double-top formation around $120. Prices have been below the declining 40-week moving average line all year. Recently, it looks like the 40-week line is turning sideways.
The OBV line has been declining since late 2015 and supports the bear case. Momentum may tip the charts bullish in the weeks ahead. Prices made a low in February and then retested that low recently. The 12-week momentum study made a low in February but then a much higher low recently. This is a bullish divergence between price and momentum and could foreshadow an upside reversal for DIS.
Bearish on DIS? Don't overstay your welcome.
