For his second "Executive Decision" segment of Mad Money Tuesday evening, Jim Cramer spoke with David Baszucki, founder and CEO of Roblox Corporation (RBLX) , the digital gaming company that just posted their first earnings as a public company.
The shares soared 21% on the news Tuesday.
Baszuki said that every day, 43 million people come to the Roblox platform to learn and play together. That connectedness only grew during the pandemic, but Baszuki said it won't end once COVID is gone.
Cramer said Roblox is his top pick for stocks heading higher between now and next year's Super Bowl. Let's check out two charts of RBLX to set some parameters.
In the daily Japanese candlestick chart of RBLX, below, we can see only three months of trading history, one of the problems that technical analysts face with recent IPOs. Prices have been in a $62 to $82 trading range. The shares soared on Tuesday and are back above the declining 20-day moving average line.
The daily On-Balance-Volume (OBV) shows a one-day move to the upside and the Moving Average Convergence Divergence (MACD) oscillator has narrowed toward a cover shorts buy signal. The middle of Tuesday's large white candle should act as support.
In the daily Point and Figure chart of RBLX, below, we used a percentage move scaling instead of the traditional even dollar scaling method. A trade at $78.26 could strengthen the chart picture and a trade at $63.50 would weaken it.
Bottom-line strategy: With only three months of price activity it is difficult for me to make a recommendation that I have confidence in. A close above $84, however, is a strong sign of further gains to come. The $71 area should act as support.