In Jim Cramer's game plan for this week he told "Mad Money" viewers Friday night that he will be paying attention on Wednesday to retailer RH (RH) and hydroponics supplier GrowGeneration (GRWG) , along with General Mills (GIS) .
Cramer said he expects good things from RH and Grow Generation. He will be listening to General Mills to see how well the pantry stocks are faring as the economy reopens.
Let's check out the charts of GrowGeneration, the retailer of hydroponic and organic specialty gardening products. We looked at GRWG on Feb. 11 and wrote "When you happen to get a stock that goes parabolic it is a real rush. You want to check your position and profits several times an hour. You dream that it can continue to the end of the day, week, month or whatever. At some point the music stops and there is a pullback or correction or worse."
Let's check the charts again.
In this updated daily bar chart of GRWG, below, we can see that prices made a sharp pullback/correction following our Feb. 11 write-up. Prices bounced off of the $35 area and are now back above the 50-day moving average line. The slope of the 200-day moving average line is still positive and intersects down around $27. The On-Balance-Volume (OBV) line shows both a decline from February into March, but also what looks to be a new rising phase. The Moving Average Convergence Divergence (MACD) oscillator has turned up and is poised to cross above the zero-line for a new outright buy signal.
In this weekly Japanese candlestick chart of GRWG, below, we can see an improving technical picture. Prices are still in a longer-term uptrend above the rising 40-week moving average line. Two recent weekly candles show lower shadows below $40 telling us that prices have declined to an area where traders are rejecting the lows. The weekly OBV line shows a little weakness in January and February, but the start of improvement this month. The MACD oscillator is poised for a positive upside crossover.
In this daily Point and Figure chart of GRWG, below, we can see a potential upside price target in the $99 area.
Bottom line strategy: Traders should be patient buyers of GRWG. Wait for a dip towards $50 risking to $47. The $100 area is our price target for later in 2021.
