In his first "Executive Decision" segment of Thursday's Mad Money program, Jim Cramer spoke with Mike Karanikolas and Michael Mente, co-founders and co-CEOs of Revolve Group (RVLV) , the online fashion retailer that reported strong earnings Thursday.
Karanikolas said that Revolve continues to see strength in its brand and all of its key metrics are near all-time highs.
Mente added that this year's Super Bowl event was a huge win for the company. Celebrities love Revolve clothes and when they wear them, social media helps spread the word. Mente was also looking forward to the return of the Revolve Festival this year, after a two-year, pandemic-induced hiatus.
When asked why its platform is so good, Karanikolas explained the company's background isn't in fashion, it's in business and technology. Using automation, Revolve can make recommendations, process orders and manage the customer experience better than the competition.
Revolve is now taking the model globally, with expansions into Canada and other international markets.
Let's check out the charts. Our last review of RVLV was way back on Aug. 21.
In the daily bar chart of RVLV, below, we can see that the shares made a low in mid-to-late January and rebounded before a dramatic retest of the January low on Thursday. Trading volume increased Thursday telling us that traders recognized and acted on the big swing down and back up. Prices are still below the declining 50-day moving average line and below the 200-day line.
The On-Balance-Volume (OBV) line shows only a modest decline from November. The Moving Average Convergence Divergence (MACD) oscillator crossed above the zero line earlier this month for a buy signal.
In the weekly Japanese candlestick chart of RVLV, below, we can see a bullish hammer pattern with a very large lower shadow as traders rejected the lows. Bullish confirmation is still needed in the form of a white candle this coming week but I would give good odds that it will happen.
The MACD oscillator is narrowing towards a cover shorts buy signal.
In this daily Point and Figure chart of RVLV, below, we can see that the column of "O's" has yet to reverse direction. A downside price target of $17 is shown.
In this weekly Point and Figure chart of RVLV, below, we can see a longer-term price target of $111.
Bottom-line strategy: Thursday's intraday recovery is pretty impressive and the candlestick chart is impressive. Let's give the market a day or two to settle down and if the gains hold then traders could approach the long side.