During the Lightning Round of Mad Money Thursday night, Jim Cramer mentioned to one caller that he also likes Charles River Laboratories International Inc. (CRL) . CRL has more than doubled in the past three years so we could see more profit-taking ahead.
Let's check out the latest charts.
In the daily bar chart of CRL, below, we can see some bearish signals. Prices rallied from late December/early January to a high in early April. Prices gapped up in February and the gap acted as support in April but that support gave way in May and early June. CRL is below its declining 50-day moving average line and a retest of the June low will take prices back below the flat 200-day line again.
The On-Balance-Volume (OBV) line shows weakness from late April telling us that sellers of CRL have become more aggressive. The Moving Average Convergence Divergence (MACD) oscillator recently turned up for a cover shorts buy signal -- an outright buy signal was last given in early February.
In the weekly bar chart of CRL, below, we can that prices have doubled from their 2016 low before correcting this year to test the flat 40-week moving average line.
The weekly OBV line has been in a downtrend from September and the MACD oscillator gave a bearish crossover at the beginning of May.
In this weekly Point and Figure chart of CRL, below, we can see a possible downside price target of $114. This would not break the December low but it would be a deep enough pullback to make the bulls sweat.
Bottom-line strategy: If you like the fundamental story behind CRL you can probably set a better buying opportunity in the weeks ahead.