Commenting on Clorox Co. (CLX) during the Lightning Round of Mad Money Tuesday night, Jim Cramer said: "The last quarter wasn't that good but the stock is still up. What happens with good news?" Let's check out the charts and indicators and trends.
In the daily bar chart of CLX, below, we can see that prices have been trading in a sideways pattern from December. Chart support or buyers have been coming in around the $145 area and rallies to around $160 have stalled a bit.
The technical indicators look like they can support an upside breakout in the near future. Prices are above the rising 50-day moving average line and the rising 200-day line.
The daily On-Balance-Volume (OBV) line has been rising the past twelve months and it has just made a new high for the move up to foreshadow a potential breakout. The Moving Average Convergence Divergence (MACD) oscillator just turned upwards for a fresh outright go long signal.
In the weekly bar of CLX, below, we can see the sideways price consolidation from the past September. Prices have been trading around the slightly rising 40-week moving average line the past few weeks.
The weekly OBV line shows a long rise and some sideways movement in the past two to three months. The MACD oscillator is turning upwards to a fresh outright go long signal.
In this Point and Figure chart of CLX, below, we can see that same sideways consolidation pattern. The software on this charting package "counts" the sideways movement and projects it upward from a breakout. A $191 price target is being projected.
Bottom-line strategy: Traders and investors could go long or increase longs on a trade above $162. Risk a close below $151 look for gains to the $175 area and maybe $191 after that.