In his first "Executive Decision" segment of Mad Money Monday night, Jim Cramer spoke with Marc Benioff, chairman and CEO of Salesforce.com (CRM) , about some new tools his company is unveiling to help companies with their reopening efforts.
Benioff said that Work.com is a platform that provides companies with the tools they need and support they need for their reopening. It will help them plan things like personal protection equipment, shift scheduling and emergency response management, and serve as a command center for all things related to Covid-19. Hopefully companies will be able to rehire quickly, but we must prepare for a recession and possibly even a depression if that doesn't happen.
We last checked the charts on April 9 and wrote that "CRM has been hammering out a bottom since the middle of March. With upside price targets of $163 and $179 from the Point and Figure charts (above), traders could probe the long side of CRM at current levels and on strength above $155. Risk a close below $137 for now." Traders who followed this recommendation last month are sitting with a nice gain as our first price target has been reached.
Let's check out some updated charts and see what strategy makes sense today.
In this daily bar chart of CRM, below, we can see that prices are trading around the 50-day moving average line and the 200-day moving average line. Trading volume was heavy in March at the nadir but has declined since then.
The daily On-Balance-Volume (OBV) line has crept up slightly the past six weeks and the Moving Average Convergence Divergence (MACD) oscillator is just now crossing the zero line for an outright go long message.
In this weekly bar chart of CRM, below, we can see that prices have been trading around the flat 40-week moving average line.
The weekly OBV line shows a small decline in February but an even smaller rise from March, telling us there was some liquidation (selling) on the decline and not a lot of new buying.
The weekly MACD oscillator is narrowing towards a cover shorts buy signal.
In this daily Point and Figure chart of CRM, below, we can see a new upside price target of $197.
Bottom line strategy: Longs should raise sell stop protection to a close below $145 now. $173 and then $197 are our price targets.