For his second "Executive Decision" segment of Mad Money Tuesday night, Jim Cramer spoke with Matt Murphy, president and CEO of semiconductor maker Marvell Technology Group Ltd. (MRVL) .
Murphy said it's been four years since his company began their transformation from a commodity chipmaker into a leading data infrastructure player. Marvell "solves for value," Murphy explained, and that means divesting in some areas while expanding in others. This strategy has made them major providers in automotive, broadband, embedded systems, switching and storage.
Turning to 5G wireless, Murphy said that Marvell has made several key acquisitions that differentiate them in the market and has allowed them to be a part of the 5G revolution in every geography.
Let's check out the charts of MRVL, which is an Action Alerts PLUS holding.
In the daily bar chart of MRVL, below, we can see that prices recovered quickly from its January-March decline. Last month MRVL made new highs for the move up, breaking out of its sideways trading range. Prices are firmly above the rising 50-day moving average line and the rising 200-day moving average line. We can also see a recent bullish golden cross with the 50-day line moving above the 200-day line.
The trading volume has been increasing since the middle of May to tell us that traders and investors are jumping in to support and profit from the rally. The On-Balance-Volume (OBV) line has been strong from late February and tells us that buyers have been more aggressive.
The Moving Average Convergence Divergence (MACD) oscillator crossed above the zero line in early April for an outright go long signal. This indicator is still bullish.
In the weekly bar chart of MRVL, below, we can see a bullish alignment of prices and indicators. MRVL is in an uptrend above the rising 40-week moving average line.
The weekly OBV line started a new strengthening phase in March and the MACD oscillator moved to an outright buy signal last month.
In this daily Point and Figure chart of MRVL, below, we can see a potential upside price target in the $45 area.
Bottom-line strategy: Traders could add to MRVL longs on a one or two-day pullback toward $32 if available. Risk a close below $29 (the breakout level) for now. The $45 area is our first upside price target. The next target is $50.
