Here's what Jim Cramer had to say about one of the stocks that a caller offered up during the Mad Money "Lightning Round" Tuesday evening. Activision Blizzard (ATVI) : "That's a good company and I'm a buyer," he replied.
Let's check out the charts and indicators.
In this daily bar chart of ATVI, below, we can see that prices have climbed higher the past 12 months. Prices gapped higher and got extended (overbought) in February and have been correcting sideways since then. ATVI is trading just below the declining 50-day moving average line. The slope of the 200-day moving average line is positive and the average intersects around $86 or $87.
The On-Balance-Volume (OBV) line has been flat/neutral so far this year. The Moving Average Convergence Divergence (MACD) oscillator is pointed down and very close to crossing below the zero line for a potential sell signal.
In this weekly Japanese candlestick chart of ATVI, below, we can see that prices have been in a long-running uptrend. Tests of the rising 40-week moving average line have been buying opportunities.
The OBV line has been positive since the beginning of 2019 but could use a new high to refresh the uptrend. The MACD oscillator crossed to the downside in February and still is in a take profit mode.
In this daily Point and Figure chart of ATVI, below, we can see a possible downside price target in the $86 area. The chart does not really turn bearish until a trade at $881.19, a new low for the move down.
In this weekly Point and Figure chart of ATVI, below, we can see an upside price target in the $114 area.
Bottom line strategy: If ATVI continues to find buying support around $90 I would want to be a buyer risking to $86 - just below the 200-day moving average line. The $114 area would be our eventual first price target.
