One of viewer' favorite segments on Mad Money is the Lightning Round. On Tuesday evening one caller got to ask Jim Cramer about Domo Inc. (DOMO) . "I like this story," said Cramer. Let's check out the chart of this cloud-based platform designed to give real-time access to business data with minimal IT involvement.
In the daily bar chart of DOMO, below, we can see that prices have sprinted higher from a small double-bottom in March/April. Prices are retesting the January/February highs. DOMO is trading above the rising 50-day moving average line and the rising 200-day moving average line.
The daily On-Balance-Volume (OBV) line has been leading the price action and has already broken out over its December-February highs. This tells us that buyers of DOMO have been very aggressive and probably buying in anticipation of higher prices.
The trend-following Moving Average Convergence Divergence (MACD) oscillator is in a bullish alignment above the zero line and headed higher.
In the weekly bar chart of DOMO, below, we can see a number of bullish divergences that are capable of propelling prices higher in the weeks ahead. The stock made a lower low in March but notice how the weekly OBV line made a higher low versus September 2019. Now the OBV line has already broken above its December high to make a new high for the recent move up. This strength in the OBV line is probably foreshadowing higher prices in the days and weeks ahead.
The MACD oscillator shows another bullish divergence in March as the oscillator shows a slightly higher low this year versus last October. A weekly close over $27.50 is what I consider a valid upside breakout on this chart.
In this Point and Figure chart of DOMO, below, we used weekly price data, which is projecting a possible price target in the $42-$43 area.
Bottom-line strategy: The charts of DOMO are strong and pointed higher. I am encouraged by the bullish divergences and the Point and Figure target. Traders could go long DOMO at current levels risking a close below $21. The low $40s is our target zone.