If the bears are right and the global economy is slowing, which stocks should investors add to their shopping lists? During Monday night's Mad Money program Jim Cramer offered up several names he said have proven track records in times of weakness.
One was McDonald's Corp. (MCD) , a restaurant turnaround that continues to improve itself. MCD has easy comparisons ahead Cramer said, which makes it a winner going into the back half of 2019.
Let's see what the charts and indicators are up to.
In this daily bar chart of MCD, below, we can see a bullish alignment of our favorite indicators. Prices are above the rising 50-day moving average line as well as the positively sloped 200-day moving average line.
The daily On-Balance-Volume (OBV) line is pointed higher and just about to break above its November high.
In the lower panel is the 12-day price momentum indicator which shows equal highs in June and July which is a bearish divergence when compared to the higher price highs. This is a small divergence and could be ignored by the marketplace.
In this weekly bar chart of MCD, below, we can see a mostly positive picture. Prices are above the rising 40-week moving average line.
Trading volume has been slowing in recent months but the weekly OBV line is still in a three year uptrend. The 12-week price momentum study in the lower panel shows that the pace of the rise since April has been slowing.
In this Point and Figure chart of MCD, below, we can see a relatively nearby price target of $221 being projected.
Bottom line strategy: MCD looks bullish on all three of the charts above. There is a bearish divergence between the price action and the momentum study but it does not seem particularly significant at this moment. Raise sell stop protection to a close below $202. $221 is the next price target.