One caller during Monday's Mad Money Lightning Round segment asked about one big contributor to the mobile telephony industry -- Nokia (NOK) . "I'm warming up to Nokia. It's come down a lot and we're almost there," was Jim Cramer's response.
Let's check out some charts and indicators. In our last review of NOK on July 22 we recommended that, "Traders could go long NOK closer to $5.50 risking to $4.50. $13 is our longer-term price target."
In the updated daily bar chart of NOK, below, we can see that NOK continued higher into early August and then quietly slipped below the 50-day moving average line. The 50-day line is slowly turning lower but the 200-day moving average line still has a positive slope and intersects down around $4.90 or so.
The On-Balance-Volume (OBV) line shows a slight drift lower from early August and the Moving Average Convergence Divergence (MACD) oscillator recently moved below the zero line for an outright sell signal.
In the weekly Japanese candlestick chart of NOK, below, we can see a large base pattern playing out over the past three years. Prices have been trading above the rising 40-week moving average line.
The weekly OBV line shows a very dramatic-looking rise from early 2020 and that suggests some very strong and aggressive buying. The MACD oscillator is above the zero line but has crossed to the downside for a take profit sell signal.
In the daily Point and Figure chart of NOK, below, we can see what appears to be a large (but slow moving) base pattern. A trade at $10 will refresh the uptrend. A decline to $3.50 is really needed to truly weaken the picture.
In this weekly Point and Figure chart of NOK, below, we can see a longer-term uptrend and if we ignore the spike up on the chart the picture becomes, in my opinion, more compelling.
Bottom-line strategy: Traders could hold longs from previous recommendations. Continue to risk to risk to $4.50.
(Nokia is a holding in TheStreet's Stocks Under $10 portfolio. Click here to learn more about this portfolio, trading ideas and market commentary product.)
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