During Monday night's 'Lightning Round' segment of Jiim Cramer's Mad Money program, one caller asked about Tandem Diabetes Care (TNDM) : "I like Tandem. I like the stock," said Cramer. Let's spend a few minutes with the charts to see if we like Tandem, too.
In this daily bar chart of TNDM, below, we can see that prices have been stuck in an eight month sideways consolidation pattern. Prices are currently above the declining 50-day moving average line and above the rising 200-day moving average line. TNDM spent the first half of the month below the 200-day line but it did not start a serious decline. Prices are now back of this longer-term indicator.
The daily On-Balance-Volume (OBV) line has been in a slow rise from early July telling us that buyers of TNDM have been more aggressive and buying shares even when prices declined.
The daily Moving Average Convergence Divergence (MACD) oscillator just moved above the zero line for an outright go long signal.
In this weekly bar chart of TNDM, below, we can see that prices have had a big rally in the past two years. Prices are back above the rising 40-week moving average line.
The weekly OBV line has been pretty steady the past 12 months and it will probably not take too much of a rally to turn the OBV to the upside and a new high.
The MACD oscillator is nearly down to the zero line but renewed price strength should avert a sell signal.
In this Point and Figure chart of TNDM, below, we can see that an upside price target of $80 is being projected.
Bottom line strategy: Selling did not increase when TNDM broke below the rising 200-day moving average line, telling us that longs stayed with their positions and that they were more focused on the bullish fundamentals. Traders and investors can approach TNDM from the long side.
