Jim Cramer had this to say about Veeva Systems (VEEV) last night on Mad Money: "It's been a great performer over the years and I'm not going to abandon ship."
We last visited with the charts of VEEV way back on April 29 and wrote that, "Longs should risk a close below $170 now; $200, $215 and $235 are our price targets now." Prices passed all our targets plus a healthy margin. How do things look now?
In this daily bar chart of VEEV, below, we can see that prices rallied into an October high. VEEV has been correcting its impressive gains from March. Prices are trading below the flat 50-day moving average line but above the rising 200-day moving average line.
The On-Balance-Volume (OBV) line has been neutral/flat the past three months after a strong rise from March.
The Moving Average Convergence Divergence (MACD) oscillator broke below the zero line in early March for a sell signal.
In this weekly bar chart of VEEV, below, we can see a bullish picture that is "poised for a correction" or at least a pause in the advance. Prices are still above the rising 40-week moving average line but the OBV line has stalled in the past two months suggesting that the bulls are taking a break.
The MACD oscillator has crossed to the downside for a take profits sell message.
In this daily Point and Figure chart of VEEV, below, we can see a potential downside price target of $227, however the chart does not weaken until a trade at $250.70, in my opinion.
Bottom line strategy: VEEV looks like it will continue to trade sideways, but increased volume on down days and a close below $255 could turn things bearish. Avoid the long side for now.
