In his first Executive Decision segment of Wednesday's "Mad Money" program from the West Coast, host Jim Cramer spoke with Frank Slootman, chairman and CEO of Snowflake Inc. (SNOW) , a data analytics company that dipped 15% when it last reported earnings, which included a murky forecast.
Slootman said the historical problem with data has been that data have been siloed. The data needed to be loaded into areas where the work happened. But with Snowflake, the work goes to where the data live, and data can easily be blended and used to forecast outcomes, he said.
This new model of data processing has allowed drug companies to reduce drug development from 12 years to just nine years, Slootman said, That's because data processes now can be run concurrently and data can more easily be shared among the many partners with which drug companies typically work.
Another growing area for Snowflake is supply chain management. Slootman said retailers can no longer rely on intuition to maintain their inventory levels; they need data processed in real time to stay ahead of issues and their competition.
We looked at the charts of SNOW on June 3 and wrote, "Shares of SNOW could bounce but I would not consider this a 'high conviction' trade. I would continue to avoid the long side of SNOW for now, but let's return to the charts in the weeks ahead to see if buyers get more aggressive." Let's look at the chart again.
In this updated daily bar chart of SNOW, below, we can see that prices have been stable in recent days. The slopes of the declining 50-day and 200-day moving averages have not changed but stable prices after a long decline are a start. The daily On-Balance-Volume (OBV) line has also stabilized, and that suggests a balance now between aggressive selling and aggressive buying. Downside price momentum is continuing to wane.
In this weekly Japanese candlestick chart of SNOW, we can see the recent candles are a doji and a spinning top. A bullish candle this week should tip the scales to the upside. The weekly OBV line is stable and the MACD oscillator has narrowed a little in the past week.
In this daily Point and Figure chart of SNOW, below, we can see an upside price target in the $192 area.
Bottom line strategy: I have a little more conviction about SNOW. Aggressive traders could probe the long side of SNOW at current levels, risking to $119 while looking for a bounce to the $180 area.