• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Bruce Kamich
    • Doug Kass
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • Trifecta Stocks
  1. Home
  2. / Investing
  3. / Stocks

Tech Data Has Formed a Bullish Technical Pattern

Here's how to play shares of this technology supplier.
By BRUCE KAMICH
Sep 19, 2019 | 10:21 AM EDT
Stocks quotes in this article: TECD

In his second "Executive Decision" segment of Wednesday's Mad Money program, Jim Cramer spoke with Rick Hume, CEO of Tech Data Corp. (TECD) , the technology supplier with shares up 15% in just the past month.

Hume said there's always something hot in technology, which is why Tech Data diversifies in many areas both geographically, and also with its product portfolio and customer base. The company sells components from everything from PCs to data centers, and sells them to over 125,000 mostly small and mid-size customers.

Hume said the world is only in the second or third inning of the digital transformation and when you add the 5G wireless roll out, there is a lot of exciting new technology on the way.

Let's see if the charts are exciting too.

In the daily bar chart of TECD, below, we can see some interesting bullish developments. TECD trades sideways from January between $90 on the downside and the $110 area on the upside. In August the bottom end of the trading range breaks temporarily with a slide to around $80. Prices gap to the upside in late August to make the decline look like an aberration.

Trading volume does not increase significantly on the August decline and the On-Balance-Volume (OBV) line stays pretty steady in August and then turns higher this month, suggesting that investors held their positions. The Moving Average Convergence Divergence (MACD) oscillator makes a similar decline in August and recovery in September.

In the weekly bar chart of TECD, below, we can see a possible or potential large inverse head-and-shoulders continuation pattern. The neckline is across the $110 area. There are left shoulders in 2017 and 2018. The head is around the fourth quarter of 2018 and the right shoulder was just made in August. Prices are above the rising 40-week moving average line.

The weekly OBV line moves with the price action and the line is close to making a new high for the move up. The MACD oscillator is crossing to the upside for a new outright go long signal.

In this Point and Figure chart of TECD, below, we can see a possible upside price target around $137. A trade at $111.98 will be a breakout on this chart.

Bottom-line strategy: A lot of investors make fun of chart patterns but they are the oldest form of investment analysis and the pattern on TECD is potentially very bullish. Traders could go long above $112. Use a reasonable stop and look for targets of $137 and then $180 based on this pattern.

Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.

Employees of TheStreet are prohibited

TAGS: Investing | Stocks | Technical Analysis | Technology | Mad Money | Executive Interview

More from Stocks

Does the Big Bounce Mean More to Come? Let's See What Drove the Move

James "Rev Shark" DePorre
Jun 24, 2022 4:42 PM EDT

Much of the rally can be attributed to structural reasons, not fundamentals, technicals, or even macro ones.

MongoDB Is Poised for a Rally

Bruce Kamich
Jun 24, 2022 2:15 PM EDT

Here's our initial upside price target for MDB which provides a general purpose database platform.

See That Down the Road? It's the Big 'Green' Bubble, Ready to Pop

Jim Collins
Jun 24, 2022 1:30 PM EDT

Environmental, social, and corporate governance has created a monster and gullible investors should hit the brakes on their EVs and run from the Washington technocrats while they have the chance.

When Times Are Tough, These 3 Mega-Caps Should Deliver the Dividends

Bob Ciura
Jun 24, 2022 1:00 PM EDT

Here's why in recessions and bear markets, the right mega-cap stocks can offer security -- and good yields.

Atlassian Is Now in the Latter Stages of Its Decline

Bruce Kamich
Jun 24, 2022 12:22 PM EDT

Let's check the charts and indicators.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 08:55 AM EDT JAMES "REV SHARK" DEPORRE

    This Weekend on Real Money

    The 10 personality traits of successful traders an...
  • 12:08 PM EDT STEPHEN GUILFOYLE

    Stocks Under $10

    As a Portfolio Name Agrees to a Merger, Here's Our...
  • 10:44 AM EDT PAUL PRICE

    My Very Best Pick for the Next 12 Months

    American Woodmark . It rarely gets better than th...
  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2022 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login