Jim Cramer told his Mad Money viewers Monday evening that the Delta variant is also on his radar, as restrictions on indoor activities will have continued impacts on restaurants and travel, but will be good for Regeneron (REGN) and Abbott Labs (ABT) , makers of COVID treatments and testing.
Let's check on the charts of ABT.
In the daily bar chart of ABT, below, we can see that the stock is testing its April and February highs. The shares are trading above the rising 50-day moving average line and the rising 200-day moving average line.
The trading volume surged when prices gapped lower in early June -- some traders sold and others with some far sight were buyers. The On-Balance-Volume (OBV) shows us a bullish pattern to confirm the price gains as buyers of ABT have been more aggressive. The trend-following Moving Average Convergence Divergence (MACD) oscillator is bullish.
In the weekly Japanese candlestick chart of ABT, below, we can see that the shares have been recovering since the hammer bottom pattern in late May. Prices have worked higher without upper shadows to tell us that traders are rejecting the highs. This is a positive and sets the shares up for a potential breakout to new highs. The shares are trading above the rising 40-week moving average line.
The weekly OBV line is positive and the MACD oscillator has crossed to the upside for a new outright buy.
In this daily Point and Figure chart of ABT, below, we can see a potential upside price target in the $164 area. A trade at $128.71 will be a new high for the move up and should refresh the uptrend.
In this weekly Point and Figure chart of ABT, below, we can see a price target in the $153 area.
Bottom-line strategy: In
our May 12 review we recommended "The broad market is undergoing a lot of shifts and turns, also called rotation. Shares of ABT might slip a little during this adjustment period, but the weekly Point and Figure chart suggests we could see significant gains later in 2021. Continue to hold remaining longs. Continue with a stop at $114. Add to longs on strength above $126." Traders were probably stopped out in early June but could reposition the long side here. Risk below $115. The $153-$164 area is our price target.
Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.
