In his "Executive Decision" segment of Mad Money Monday night, Jim Cramer spoke with Harley Finkelstein, president of Shopify (SHOP) , for an update on the Black Friday shopping weekend.
Finkelstein said that small businesses are the real winners of the season so far and Shopify customers booked a record $2.9 billion in sales on Friday alone. That's a 21% increase over 2020.
While it's still too early to tally up the total Cyber Monday sales, Finkelstein was able to predict that sales would also surpass last year's volumes. The Shopify platform had been processing up to $1.5 million per minute thus far on Monday.
Shopify's mission is to support artists and small businesses, Finkelstein added. The future of business will be global, he said, and all of the most popular brands today are getting their start on Shopify. The barriers to success have never been lower, he said, and only Shopify can turn your idea into a global phenomenon.
Let's check out the charts and indicators of SHOP once again. We looked at SHOP on November 24 and recommended, "The news flow and trading volume tell me that SHOP did not make a bull trap and that the candlestick reversal is probably going to result in some sideways price movement for a couple of weeks. Continue to hold longs recommended in late October." Let's see if things have shifted further.
In this daily bar chart of SHOP, below, we can see that prices have inched lower towards the rising 50-day moving average line. The daily On-Balance-Volume (OBV) line is rolling over after not making a new high for the move up. This difference from the price action is a minor bearish divergence.
The Moving Average Convergence Divergence (MACD) oscillator has crossed to the downside at a lower high than seen in June. This too is a bearish divergence versus the price action. Two warning shots.
In this weekly Japanese candlestick chart of SHOP, below, we do not see much change from last week except for the follow through selling (red candle). The MACD oscillator has weakened and is edging closer to a bearish crossover.
In this updated daily Point and Figure chart of SHOP, below, with a fresh column of "O's". The downside price target remains $1,288.
Bottom line strategy: Despite positive sounding fundamental news, weakness in the broad market has me moving closer to the exit door. Traders who are long SHOP should consider booking some profits on available strength and raising stops to $1,480.
