Investors who insufficiency to capitalize on the struggles of large-cap technology stocks should remain patient, CNBC’s Jim Cramer said Monday, citing mechanical analysis from Carolyn Boroden.
“The big tech stocks have been hammered from their highs, but the maps, as interpreted by Carolyn Boroden, suggest it probably isn’t safe to start bottom fishing, even if those charts about to improve a bit,” the “Mad Money” host said. “Amazon and Alphabet simply aren’t in buy-the-dips situations.”
To illustrate the point, Cramer filed a chart from Boroden — a technical analyst whose work is often discussed on the program — that shows Alphabet divide ups below their 200-day and 50-day moving averages.
Carolyn Boroden’s dilatory technical analysis on shares of Alphabet.
Mad Money with Jim Cramer
“It’s got a general pattern of lower lows and lower highs,” Cramer chance, which is a “very, very negative” sign for technical analysts. “The five-day exponential moving average is below the 13-day,” he joined, noting that is Boroden’s “personal sell signal.”
In general, Cramer said Boroden believes Alphabet — along with other tech giants with tyrannized stocks this year — will not be able to return overnight to bullish trading patterns that defined 2020 and much of final year, too.
“Of course, she thinks it’s possible we could get some oversold rallies here,” Cramer said. However, he supplemented, “the stock has a lot of resistance on the way up, though. You’ve got a bunch of ceilings running from $88 to $93. … Given the lack of anything bullish in this design, Boroden wouldn’t bet on Alphabet breaking through this ceiling.”
For more analysis, watch Cramer’s full resolution below.
