Ina recent Lightning Round segment of Mad Money, one caller asked about Vroom Inc. (VRM) . "Used cars are on fire and this is a good company. This is a good one," said Cramer.
Let's check out two charts.
In the daily candlestick chart of VRM, below, we barely have a month of trading but we can share some observations. We can see upper shadows above $58 telling us that traders are so far rejecting prices above there. We can also see some lower shadows below $52 suggesting that buyers are being more active below that level. The $52 level is the middle of the large white candle on June 25 and that area is acting as support.
The On-Balance-Volume (OBV) line shows a slight rise in recent days and that tells us that buyers are being slightly more aggressive than sellers.
In this limited Point and Figure chart of VRM, below, we can see that a trade at $50 will probably weaken this chart picture.
Bottom-line strategy: Knowing that we have limited information, aggressive traders could approach the long side of VRM around $55, if available, risking a close below $52. The $84 area is a very tentative price target.