For his second "Executive Decision" segment of Mad Money Wednesday night, Jim Cramer spoke with Laura Alber, president and CEO of Williams-Sonoma Inc. (WSM) , the home furnishings and kitchen goods retailer that managed to deliver positive same-store sales this quarter, despite many of their stores being closed.
When asked about those sales, Alber said Williams-Sonoma was able to find new ways to engage with their customers, including online and virtual services that culminated in an omnichannel experience and positive same-store sales.
Alber added that physical stores are a competitive advantage for the company, but they don't need as many as they currently have. E-commerce will continue to be the growth driver for the company.
Let's check out the charts and indicators and maybe a few new gadgets for the kitchen.
In the daily bar chart of WSM, below, we can see a clear V-bottom pattern in March after the pandemic decline. Prices quickly and decisively rallied above the February and the January highs. WSM is trading above the rising 50-day moving average line and the rising 200-day moving average line. There is a (belated) golden cross of these two averages in early June.
The On-Balance-Volume (OBV) line shows a strong and bullish rise from March to early June to confirm the rally but the OBV line softened the balance of June and suggests some profit-taking. The trend-following Moving Average Convergence Divergence (MACD) oscillator turned bullish in late April but turned lower in June. The oscillator now looks like it is narrowing toward a bullish crossover.
In the weekly bar chart of WSM, below, we can see the progress of the last three years. Prices did break the lows of 2018 and 2017 but they reversed gears quickly. WSM is back above the rising 40-week moving average line and the weekly OBV line is going up.
The MACD oscillator crossed above the zero line last month for an outright long message.
In this daily Point and Figure chart of WSM, below, we can see a potential upside price target in the $108 area.
Bottom-line strategy: I am looking for WSM's sideways consolidation of June to resolve on the upside. Aggressive traders could go long WSM at current levels risking a close below $75. Our price targets for now are $100 and $108.