CNBC’s Jim Cramer advised investors on Monday to buy shares of Apple, Tesla and Microsoft if they decline.
“The charts, as interpreted by Carolyn Boroden, suggest that Apple, Tesla and Microsoft could stagnate a bit here, or even pull back slightly as they approach resistance levels, but she recommends buying into any weakness and think their charts remain bullish over the long term,” the “Mad Money” host said.
Boroden decided to focus on Apple, Tesla and Microsoft after seeing an uptrend of higher highs and lows in stocks, as well as a five- and 13-day exponential moving average crossover, according to Cramer.
To begin his explanation of Boroden’s analysis, Cramer first looked at Apple’s daily chart.
Boroden noted that Apple’s latest rally appears to have created a ceiling of resistance at around $173, and that ceiling must be breached before Apple’s surge can continue, Cramer said.
He added that Boroden believes that if Apple can make less than a dollar and stay put, then the price could rise to $197.60 – a price target she calculated using Fibonacci ratios. Boroden and other market technicians use the Fibonacci strategy to spot patterns that can signal when a stock or other security might be changing direction.
Boroden also sees five Fibonacci synchronization cycles coming between today and Friday, which means Apple is more likely to alter its trajectory during this time. In other words, the iPhone maker’s stock could be heading lower.
However, if it remains intact, the long-term chart is still bullish, according to Boroden.
For more analysis, watch the full video of Cramer’s explanation below.
Disclosure: Cramer’s Charitable Trust owns shares of Apple and Microsoft.
Comments are closed.