During the 'Lightning Round' of the Mad Money program, callers get a chance to ask Jim Cramer about stocks they are interested in. One caller Tuesday night asked about Amarin Corp. (AMRN) : "I liked the quarter and I like the stock here," replied Cramer.
In this daily bar chart of AMRN, below, we can see that prices have been holding the $14 area. The bigger picture is that prices have been in a wide sideways trading range the past 12 months. Prices are below the declining 50-day moving average line and the flat to declining 200-day moving average line.
The daily trading volume histogram below the price chart shows a number of surges or spikes in volume but the On-Balance-Volume (OBV) line shows a decline from August to October, and a decline from December to now. Both of these declines suggest that sellers of AMRN have been more aggressive.
The Moving Average Convergence Divergence (MACD) oscillator moved below the zero line in January and it is still bearish.
In this weekly bar chart of AMRN, below, we can see that prices are in the lower part of a long sideways trading range pattern. Prices are below the declining 40-week moving average line.
The weekly OBV line has been weakening since November and tells us that sellers on this time frame have been more aggressive.
The MACD oscillator is crossing the zero line for an outright sell signal.
In this first Point and Figure chart of AMRN, below, we used daily price data. A long downtrend can be seen and the only positive on this chart is that a downside price target around $17 has been reached.
In this second Point and Figure chart of AMRN, below, we used weekly close only price data. Here a downside price target of $6 is indicated but a weekly trade at $14 is needed to weaken the chart.
Bottom line strategy: I am not sure that AMRN is a good purchase here but I can say that a weekly close below $14 would be a good place to stop out any long positions.
