In his Executive Decision segment of "Mad Money" Wednesday, host Jim Cramer spoke with Marc Benioff, chairman and CEO of Salesforce.com (CRM) , which on Wednesday closed on its acquisition of Slack Technologies.
Benioff said Slack is transforming the way we work and the pandemic only accelerated that transformation. Salesforce has been integrating Slack into all its products and the result has been that everything got even better, he said.
There are many naysayers surrounding the Slack deal, but Benioff noted that there were just as many naysayers around its Tableau acquisition and every deal Salesforce does. "We are in a post-pandemic reality where there's still a pandemic," he said, and that requires CEOs to re-conceptualize their businesses with bold moves such as the Slack acquisition.
Let's check the charts of CRM, which is a holding of Cramer's Action Alerts PLUS charitable trust.
In this daily bar chart of CRM, below, we can see a correction from early September followed by a bottoming pattern since January. Prices have made a saucer-like bottom pattern and are now trading above the rising 50-day moving average line and above the flat or neutral 200-day moving average line. The trading volume looks like it bottomed in March and May, but the On-Balance-Volume (OBV) line has been roughly neutral-looking since December. The Moving Average Convergence Divergence (MACD) oscillator is pointed down but still slightly above the zero line.
In this weekly Japanese candlestick chart of CRM, below, we see a mixed picture. Prices are trading above the 40-week moving average line but the slope of the line is negative or bearish. The trading volume looks like it declined into a June low. Increasing volume at this point in time would be a positive. The weekly OBV line shows a rise from a March low but could be a lot stronger. The MACD oscillator is above the zero line but narrowing.
In this daily Point and Figure chart of CRM, below, we can see that the software is projecting an upside price target in the $312 area. A decline to $231.52 would probably weaken the picture.
In this weekly Point and Figure chart of CRM, below, we can also see a $312 price target.
Bottom line strategy: CRM made a low in March and a higher low in May but it looks like it needs a strong move over $250 to really get going. Traders who went long in April should continue to hold those positions. Traders who are flat could go long CRM at current levels while risking to $225. Add to longs above $255. The $312 area is our first price target.