Here's what Jim Cramer had to say about some of the stocks that callers offered up during the Mad Money "Lightning Round" Tuesday evening - Ocugen (OCGN) : "This is a good speculative stock," Cramer told the caller. The company used to be called Histogenics Corp. and is a clinical stage biopharmaceutical firm that is focused on discovering, developing and commercializing a pipeline of therapies for eye diseases.
Let's "see" what the charts show.
In this daily Japanese candlestick chart of OCGN, below, we find some interesting clues. Prices were flat-lined before the middle of December. In late December prices and trading volume come alive. Prices drift lower for much of January correcting the December pop but in early February prices explode again. OCGN surges from $2 to $18 in a few sessions with a large price gap that has since been filled.
On light volume and a flat On-Balance-Volume (OBV) line prices have given up much of the gains and are trading below the cresting 50-day moving average line. The 12-day price momentum study is not yet showing us a clear bullish divergence to suggest that the pullback is over.
In this weekly bar chart of OCGN, below, we went back three years and needed to use a log scale to properly display the price moves. Prices bottomed out for much of 2020 before the recent upside move. The rally encountered selling resistance in the $15 area which is not surprising in that area as it was support in 2019. Prices are above the rising 40-week moving average line.
The weekly OBV line shows some weakness the past two months suggesting that some traders were more aggressive sellers on approach to the $15 area. The MACD oscillator is too hard to read on this scale.
In this daily Point and Figure chart of OCGN, below, we can see a potential downside price target in the $1.50 area. Ouch. Chart support starts at $3.50.
In this weekly Point and Figure chart of OCGN, below, we see a downside price objective of $2.50. A weekly trade at $19 is needed to turn the chart bullish.
Bottom line strategy: Eye disease is probably a growth industry considering the demographics in the United States and other developed countries. (I called yesterday for an appointment with our eye doctor and he is booking in June now.) Unfortunately the charts of OCGN are pointing lower right now. Let's stay on the sidelines until a fresh and durable base forms.