In his first Executive Decision segment of Wednesday's "Mad Money" program, host Jim Cramer spoke with Anthony Noto, CEO of SoFi Technologies (SOFI) , the online lender that Wednesday after receiving regulatory approval to become a national bank.
Let's check out the charts and indicators of SOFI.
In this daily bar chart of SOFI, below, we can see a downtrend over the past 12 months interrupted by a number of impressive but short-lived rallies. Prices are trading below the declining 50-day moving average line and the bearish 200-day line. Trading volume has been increasing since late June, but it has not translated into a sustained advance. The On-Balance-Volume (OBV) line showed improvement from August to November but it has since sunk to a new low, telling us that sellers of SOFI are more aggressive. The Moving Average Convergence Divergence (MACD) oscillator is bearish.
In this weekly Japanese candlestick chart of SOFI, below, we can see three failed rallies. Each upside attempt failed at a lower high and each decline has made a lower low. The slope of the 40-week moving average line is negative. The weekly OBV line is bearish and the MACD oscillator is, too.
In this daily Point and Figure chart of SOFI, below, we can see the software is projecting a potential downside price target in the $5 area.
Bottom line strategy: SOFI may capture more customers across the USA but the charts are not favorable at this point in time. SOFI may not sink to $5, but it needs to make a base pattern before it becomes attractive to technically oriented traders. Avoid.