Is this the end of index funds Jim Cramer wondered during Monday's Mad Money program? Financial advisers have told investors for years that it is easier to just own the whole market than individual stocks. But in a Covid-19 world, where vast swaths of the economy aren't working, Cramer said he's got a better way to invest.
Cramer unveiled his Mad Money Covid-19 Index Monday night, a collection of stocks all of which are worthy of being in your portfolio.
Home entertainment was in the index, represented by stocks like Netflix Inc. (NFLX) and Roku Inc. (ROKU) so let's check out the charts of ROKU again. When we looked at ROKU on April 23 and wrote that, "ROKU has chart resistance above $130 but the current uptrend looks strong enough to overcome it in the weeks ahead. Trade from the long side and risk below $110."
With prices trading lower Tuesday another check of the charts may be a good idea.
In the updated daily bar chart of ROKU, below, we can see the shares have moved to the lower end of their recent sideways consolidation pattern. Prices are back below the rising 200-day moving average line.
The daily On-Balance-Volume (OBV) line is still pointed up and the Moving Average Convergence Divergence (MACD) oscillator is above the zero line but it has begun to narrow recently, which indicates some weakening in the strength of the trend.
In the weekly bar chart of ROKU, below, we don't have much change from last week but that is the nature of charts that update on Friday's close. Prices are trading around the rising 40-week moving average line.
The weekly OBV line looks steady at this point in time and the MACD oscillator is poised for an upside crossover and potential cover shorts buy signal.
In this daily Point and Figure chart of ROKU, below, we can see that the chart is now projecting a possible downside target in the $110 area. A big difference from last week's target of $217.
Bottom-line strategy: Prices rarely move in a straight line so maintain your stop protection on any ROKU longs.