• 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

Teladoc's Charts Are Bearish - Avoid the Long Side for Now

Prices have broken the lows of August and September so the trend has turned down.
By BRUCE KAMICH
Nov 19, 2020 | 07:51 AM EST
Stocks quotes in this article: TDOC, LVGO

In his first "Executive Decision" segment of his Mad Money program Wednesday night, Jim Cramer welcomed back Jason Gorevic, CEO of Teladoc Health (TDOC) , the telemedicine provider that's seen its shares stall in recent weeks after the company announced a merger with Livongo Health (LVGO) .

Gorevic said that Teladoc has seen an incredible transformation this year. At the beginning of the year they were fighting for awareness, but as the pandemic hit they moved through the acceptance phase and right into the expectation phase.

Patients who have tried telemedicine don't go back to the waiting room, he said. Patients want, and expect, to have options.

Gorevic added that with the acquisition of Livongo, Teladoc has a strong breadth of services and is truly the only global healthcare delivery platform.

Teladoc is proud to be expanding access for mental health services around the globe. Gorevic said mental health is a vital, but underutilized, part of our healthcare system and one that lends itself to telemedicine.

We last looked at TDOC on July 30 and recommended that "I may be leaving money on the table, but I recommend that traders who are long TDOC from prior recommendations take profits at current levels and raise sell stop protection on the balance of any remaining longs to $202." Let's see how things look 3 1/2 months on.

In this updated daily bar chart of TDOC, below, we can see that prices made a peak just a few days after our July 30 review. TDOC has worked irregularly lower and has made new lows for the move down this month. Prices are trading below the declining 50-day moving average line and below the rising 200-day moving average line. Trading volume has increased since late October and as prices have declined.

The On-Balance-Volume (OBV) line peaked in early August with price and has declined since then, telling us that sellers of TDOC have become more aggressive with heavier volume being transacted on days when the stock has closed lower.

The Moving Average Convergence Divergence (MACD) oscillator is well below the zero line in sell territory and barely showing signs of narrowing.

In this weekly bar chart of TDOC, below, we can see a topping pattern play out over the past six or seven months. Prices are now below the rising 40-week moving average line. When the slope of the 40-week average turns negative it will be another technical sign of weakness.

The OBV line peaked in May and is close to making a new low for the move down.

The MACD oscillator crossed to the downside in late July for a take profits sell signal. The oscillator is still above the zero line, so the trend has not (yet) turned bearish.

In this daily Point and Figure chart of TDOC, below, we can see that prices have reached and exceeded the downside price target in the $189 area.

In this weekly close only Point and Figure chart of TDOC, we can see a potential downside price target in the $138 area.

Bottom line strategy: I assume that traders who took my advice either took profits or got stopped out below $202. Prices have broken the lows of August and September so the trend has turned down. TDOC might find support in the $165-$150 area but that might not be good enough to recommend repurchase as long as the broad market is showing weakness. Stand aside for now.

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 from trading individual securities.

TAGS: Investing | Stocks | Technical Analysis | Trading | Health Care Equipment & Services | Mad Money | Executive Interview | Telecom Services

More from Investing

Let's Shine a Light on Lucid Motors as It Slides Downhill

Brad Ginesin
Jul 2, 2022 1:00 PM EDT

LCID's market cap has been deflated, so is it now a bargain, or can it slip further?

Stop Wishing, Hoping and Praying and Take Control of Your Investing

James "Rev Shark" DePorre
Jul 2, 2022 10:00 AM EDT

The most powerful thing an investor can do is embrace the idea that they don't know what the future holds.

If You've Got Time, These Three Dividend Aristocrats Should Pay Off

Bob Ciura
Jul 2, 2022 7:30 AM EDT

There high-growth dividend stocks will be here over the long haul.

Welcome to Second Semester on Wall Street, Here's How to Make the Grade

Jim Collins
Jul 1, 2022 4:36 PM EDT

Think you can own big tech? You might just get an 'F' for that. Here's what will get you on the other side of this year.

We Got a Break, but the Heat Is Still On

James "Rev Shark" DePorre
Jul 1, 2022 4:22 PM EDT

A limited rally cooled some of the negativity on the market, but guess what's going to hit the fan soon?

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

  • 09:49 AM EDT JAMES "REV SHARK" DEPORRE

    This Weekend on Real Money

    Stop Wishing, Hoping, and Praying and Take Control...
  • 07:59 PM EDT PAUL PRICE

    Very Good Quarterly Numbers From Bassett Furniture (BSET)

    Bassett Furniture blew right through analysts es...
  • 04:41 PM EDT PAUL PRICE

    First-Half Results - Putrid; Second Half Results - Likely to Be Much Better

    It's great that we're done with June. 2022 mark...
  • 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