During Tuesday's Mad Money program, Jim Cramer talked about the optimistic side, as some investors feel the U.S. will follow in China's footsteps, with a slow and rocky restart to the economy that eventually leads to a return to growth.
This makes sense for industries like healthcare, where a lifting on the moratorium on elective procedures could be a big win for companies like AbbVie (ABBV) . The selfie generation has been replaced overnight by the Zoom (ZM) generation, Cramer said, and the demand for Botox will be huge once people can again see their doctors. Meanwhile, let's see if the charts are attractive.
In this daily bar chart of ABBV, below, we can see that prices made a fast plunge from the middle of February to the middle of March and retested the August lows. Prices have rebounded quickly to move back above the rising 200-day moving average line. ABBV has traded sideways for the past few weeks and looks poised to resume its gains.
The daily On-Balance-Volume (OBV) line has been strong since late March as buyers have been more aggressive and now the line is close to making a new high for the year.
The Moving Average Convergence Divergence (MACD) oscillator crossed above the zero line last month for an outright go long signal. This indicator has narrowed sharply but could turn up again if prices strengthen from here.
In this weekly bar chart of ABBV, below, we can see a large potential bottom formation that just needs a weekly close above $95 for a breakout. Prices are above the rising 40-week moving average line and the trading volume has been building in the second half of the pattern.
The OBV line has been rising since August and that's a positive. The MACD oscillator is poised to turn up to a fresh buy signal.
In this Point and Figure chart of ABBV, below, we can see that prices made a new high for the move up at $86.45 and now a $100 price target is shown.
Bottom line strategy: Trade ABBV from the long side at current levels and risk a close below $80 for now. Our target is the $100 area.