Viewers of Mad Money love to call in to ask Jim Cramer about stocks they're interested in. On the other hand, I get emails from readers of Real Money about stocks they're interested in. Today one reader sent me this message: "Could you do a write-up on Nutrien (NTR) ?" Here we go.
In this daily bar chart of NTR, below, we can see that prices bottomed with the broad market in March. NTR zigzagged higher to double over the past nine months. Prices are trading above the rising 50-day moving average line and above the rising 200-day line.
The math-driven On-Balance-Volume (OBV) line has gone up this year but not in a smooth and steady manner as there have been a number of declining phases along the way. Buyers have been more aggressive but not consistently so.
The 12-day price momentum study shows a lower high from December to January telling us that the rally has begun to slow. This is a bearish divergence when compared to prices making higher highs from December to January.
In this weekly Japanese candlestick chart of NTR, below, we can see that prices are now back in a band of resistance from 2018 and 2019 that goes up to the upper $50's. Prices are above the rising 40-week moving average line.
The weekly OBV line has greatly lagged the price action. The slow stochastic indicator got very overbought on the rally in December and is likely to make a lower high on the rally so far in January.
In this daily Point and Figure chart of NTR, below, we can see a potential upside price target in the $64 area. A decline to $50 is likely to weaken this chart.
Bottom line strategy: NTR is in a band of resistance and with some bearish divergences -- it makes sense to reduce one's long exposure.
