Shockwave Medical (SWAV) is a medical device company that is working on developing products to change the way "calcified cardiovascular disease" is treated. For personal reasons I am interested in this technology, but as a technical analyst I wonder how the company's shares are performing. Let's check the pulse of Shockwave's charts and indicators to find out.
In this daily bar chart of SWAV, below, I can see two significant highs on this chart, one last October and another in June. Prices made a low in January. In recent weeks prices gapped below the 200-day moving average line and now trade below both the 50-day and the 200-day negatively sloped moving averages. The math-driven On-Balance-Volume (OBV) line has been in a declining mode since early May and tells me that sellers of SWAV have been more aggressive than buyers for more than five months. The Moving Average Convergence Divergence (MACD) oscillator is in a bearish alignment below the zero line and poised for a fresh outright sell signal.
In this weekly Japanese candlestick chart of SWAV, below, I see what I believe is a large topping pattern playing out over the past few years. Prices are trading below the declining 40-week moving average line. The weekly OBV line shows us a number of weakening trends and shows a decline since June. The MACD oscillator has crossed below the zero line for an outright sell signal. I can see an upper shadow and a lower shadow in the past two months, but I suspect the trend, which is down, to win out.
In this daily Point and Figure chart of SWAV, below, I can see a downside price target in the $188 area.
In this second Point and Figure chart of SWAV, below, I used weekly price data with a five-box reversal filter. Here the software yields us a price target in the $186 area.
Bottom line strategy: The charts of SWAV suggest we are going to see weaker prices in the weeks and months ahead. Avoid the long side of SWAV.
