For his second "Executive Decision" segment of Mad Money Friday evening, Jim Cramer spoke with Rowan Trollope, CEO of Five9 (FIVN) , the call center company.
On Friday they announced that its shareholders rejected an acquisition offer from Zoom Video (ZM) , a deal first announced in July.
Trollope said that he's been in close contact with Five9's investors and they've been very supportive throughout this process. Five9 was excited to do the deal with Zoom, but Trollope said they're equally excited to continue as a stand-alone company.
Sales at Five9 continue to be strong, Trollope continued, with enterprises adopting the company's platform more than ever.
Let's check out the charts of FIVN again. In our May 17 review we wrote that "FIVN has not made any upside progress since reaching our $200 price target. A stronger test of the 200-day line is possible and the daily Point and Figure chart is pointed down toward $144. Traders should sell their remaining longs or tighten their sell stops to $152."
In this daily bar chart of FIVN, below, we can see that prices turned lower in late August with a gap to the downside and a break below the 200-day moving average line. For all of September FIVN traded below the bearish 50-day moving average line and rallies to the underside of the 200-day line failed.
Trading volume has been heavy since the middle of July when the takeover was proposed and the On-Balance-Volume (OBV) line has seen choppy sideways movement. The Moving Average Convergence Divergence (MACD) oscillator turned bearish in late August.
In this weekly Japanese candlestick chart of FIVN, below, we see mixed signals. Prices made a peak in July and corrected lower and have been trading below the 40-week moving average line. FIVN has also been making lower shadows below $165 which tells us that traders are rejecting the lows or buying the dips.
The weekly OBV line jumped higher in July but then stalled and weakened as the M&A deal was rejected. The MACD oscillator has been moving lower since February telling us that the "trend strength" has been weakening.
In this daily Point and Figure chart of FIVN, below, we can see a potential upside price target in the $194 area.
In this weekly Point and Figure chart of FIVN, below, we can see a potential bearish price target in the $140 area.
Bottom line strategy: The strategy for FIVN could spin in either direction. The lower shadows on the weekly Japanese candlestick chart says we should go long, while the weekly Point and Figure chart is bearish. Put FIVN on your watch list and we can look at it again soon.
