During Tuesday night's Mad Money program, Jim Cramer was very bullish on Symantec (SYMC) . Prices have made a large broadening pattern the past 12 months which means we could see a retest of the early June low.
Let's check out the charts and indicators.
In this daily bar chart of SYMC, below, we can see the price action from last August. Prices have made higher highs in September, November, February, April and July. Lower lows can be seen in August, October, December and early June.
Trading volume is uneven but the On-Balance-Volume (OBV) line actually trends higher the past year suggesting accumulation (buying). Recently prices close below the rising 50-day and the 200-day moving averages.
If this widening pattern continues we could see a retest of the June low below $18. Back in the days of the 1920's and pool operators, this pattern was considered very bullish. Today I am not that sure.
In this weekly bar chart of SYMC, below, we can see the broadening pattern better. Prices are below the rising 40-week moving average line.
The weekly OBV line is bullish and the MACD oscillator is poised to move below the zero line again.
In this Point and Figure chart of SYMC, below, we can see a downside price target of $18 being projected.
Bottom line strategy: In this weak broad market environment I would look to defer purchases of SYMC and see how it behaves around $18.