For his Executive Decision segment of "Mad Money" Thursday, Jim Cramer spoke with Vlad Shmunis, founder, chairman and CEO of RingCentral Inc. (RNG) , a cloud-based business communicaitons company with shares up 18% in just the past week.
Shmunis said RingCentral's success stems from great products in a great market and being at the right place at the right time. He also called its new partnership with Avaya "industry defining." Shmunis said RingCentral empowers small business to operate like large ones, with voice, text messaging, video and more.
Let's check and see if the charts of RNG offer more in the way of information.
In this daily bar chart of RNG, below, we can see that prices indeed have been very strong and have more than doubled in the past 12 months. RNG is above the rising 50-day moving average line and perhaps extended above the rising 200-day moving average line. The trading volume has been increasing since September and tells us that more traders and investors have become involved in the stock and the bullish story. The daily On-Balance-Volume (OBV) line shows a strong climb higher from early October, telling us that buyers of RNG have been particularly aggressive. The Moving Average Convergence Divergence (MACD) oscillator has been bullish since October and is pointing higher.
In this weekly bar chart of RNG, below, we can see an impressive rise the last three years with prices up eight-fold. RNG is above the rising 40-week moving average line and we can see some tests of that indicator in the past. These obviously were buying opportunities in hindsight. The weekly trading volume shows a steady increase in the past years. The weekly OBV line shows a steady rise and confirms the price gains. The MACD oscillator on this longer time frame has been above the zero line the entire time and is still pointed higher.
In this first Point and Figure chart of RNG, below, we used daily price data. A relatively nearby price target of $253 is projected.
In this second Point and Figure chart of RNG, below, we used weekly high/low price data to construct the chart. Here a potential longer-term price target of $291 is projected.
Bottom line strategy: RNG is in a textbook-like advance and likely headed higher. Stay long for targets of $253, $291 and $300. Risk a close below $200.