Jim Cramer told his Mad Money viewers Wednesday night that what's good for Netflix (NFLX) is also good for streaming device maker Roku (ROKU) and for The Trade Desk (TTD) , which provides advertising services for streaming applications. Cramer said that while Roku is pricey at 20 times sales, The Trade Desk is a bargain after the stock's recent pullback.
Let's check out the charts and indicators of The Trade Desk.
Our last review was back on Oct. 6 where I wrote that "Selling a stock on strength can give you sellers' remorse but when a stock is very overbought and price momentum has been diverging the decision to take profits is not hard. I recommend that traders and yes, even investors, consider booking profits on TTD at the market." TTD declined into early November but then soared to still higher highs into December. Another decline unfolded into early January.
What do we see now?
In the daily Japanese candlestick chart of TTD, below, we can see three corrections since October. The most recent pullback/correction has been the deepest so far. Prices declined below the rising 50-day moving average line and have rallied back to the underside of this indicator.
The On-Balance-Volume (OBV) line finally shows weakness from late December telling us that sellers of TTD have become more aggressive. The Moving Average Convergence Divergence (MACD) oscillator crossed below the zero line earlier this month for an outright sell signal.