During the 'Lightning Round' segment of Mad Money Thursday night, Jim Cramer fielded calls from some viewers. One caller asked about CyrusOne (CONE) : "I think that data center play is fabulous," said Cramer.
CONE is a real estate investment trust that invests in carrier-neutral data centers and provides location and peering services.
In this daily bar chart of CONE, below, we can see that prices have made a pattern of higher lows and higher highs the past year - commonly called an uptrend. Unfortunately a strong rally in August and September was mostly retraced in October and November. Prices are currently testing both the declining 50-day moving average line and the rising 200-day line. Support was found the $62-$60 area but the early December low has not been retested yet.
The daily On-Balance-Volume (OBV) line has only made a modest recovery from the low in December so we cannot say that buyers of CONE have made a strong return.
The Moving Average Convergence Divergence (MACD) oscillator gave a cover shorts buy signal in late October and is now poised to cross above the zero line for an outright buy signal.
In this weekly bar chart of CONE, below, we can see that CONE has been more of an up and down affair the past three years - great for nimble traders but on the disappointing side for buy and hold investors. Prices are now trading around the rising 40-week moving average line.
The weekly OBV line shows a declining pattern for much of the last three years.
The MACD oscillator on this longer time frame is above the zero line and narrowing slowly towards a potential bullish crossover.
In this first Point and Figure chart of CONE, below, we used daily price data to plot and the X's and O's. The chart shows a potential upside price target around $77.
In this second Point and Figure chart of CONE, below, we used weekly close only data and here an ambitious upside price target of $119 is indicated.
Bottom line strategy: Traders and investors who can risk a close below $60, the December low, can play CONE from the long side.
