The fast-paced "Lightning Round" segment of Mad Money is a viewer favorite. Thursday night one caller asked Jim Cramer what he thought of Vertex Pharmaceuticals (VRTX) : "I'm surprised how far it's fallen but I can't advise selling it down here," responded Cramer.
Let's pay a visit to the charts and indicators.
In this daily bar chart of VRTX, below, we can see that prices have moved lower and lower the past 12 months. The chart looks like steps going down to the basement. VRTX made a low in June that has not been broken so we have a glimmer of light.
The On-Balance-Volume (OBV) line has been in a decline since December and tells us that we have seen months of aggressive selling. The trend-following Moving Average Convergence Divergence (MACD) oscillator is bearish.
In this weekly Japanese candlestick chart of VRTX, below, we see that prices have been in a lengthy decline from above $300 to below $200. A couple of small lower shadows around $190 suggest that some traders are starting to reject the lows. The $180-$160 area looks like it should provide some support as prices based there back in 2018-2019.
The OBV line has been in a decline since the middle of 2020. The MACD oscillator has edged up slightly since June.
In this daily Point and Figure chart of VRTX, below, we can see that prices reached a downside price target in the $192 area.
In this weekly Point and Figure chart of VRTX, below, we can see a lower price target in the $173 area.
Bottom line strategy: The charts and indicators of VRTX are still pointed lower but there are some very subtle clues that suggest we don't want to be overly bearish after the big decline so far. Continue to stand aside but check back every now and then to see if the tide is beginning to shift.