For his final "Executive Decision" segment of Mad Money Wednesday evening, Jim Cramer checked back in with Bracken Darrell, CEO of Logitech International S.A. (LOGI) , makers of computer peripherals including video conferencing systems.
Darrell said there's a long-term secular trend toward more remote work and the coronavirus pandemic has only accelerated that trend as more people look to replicate at home the video conferencing they have in the office. Logitech is also seeing strength in their other stay-at-home business, gaming. Darryl noted that the online gaming network Steam saw a record 19.7 million simultaneous users earlier this week as more people stay home and wait out the virus.
Let's check out the charts of LOGI from home this morning.
In this daily bar chart of LOGI, below, we can see some bottoming action. Yes, prices are down and below the declining 50-day moving average line and the declining 200-day moving average line, but that is not all we look at.
Trading volume has been very heavy this month and prices have actually bounced up in recent sessions. The daily On-Balance-Volume (OBV) line declined for about four weeks but recently turned up. We'll see if that lasts.
The 12-day price momentum study in the lower panel shows higher lows from late February and that suggests that the pace of the decline has slowed. This is a bullish divergence and can foreshadow further near-term price strength.
In this weekly candlestick chart of LOGI, below, we can see that prices have declined towards the lows of late 2018. Interesting that prices have not broken those lows in this bearish environment. Prices are below the cresting 40-week moving average line.
The weekly OBV line does not show much strength in the past year but at the same time does not show much weakness in recent weeks. The 12-week price momentum study has begun to slow. This is a subtle improvement but not a bullish divergence.
In this daily Point and Figure chart of LOGI, below, we can see that an upside price target of $50 is being projected.
Bottom line strategy: It is hard for traders and investors to believe that a stock is showing bottoming clues when the broad market gets offered limit down, but that is what I am seeing on LOGI. Aggressive traders (if they still exist) could probe the long side of LOGI on available weakness risking a close below $34.