Technical analysis
Price | $ 204.75 | 52 weeks range | $ 184.44 - $ 311.75 |
Beta | 1.18 | Volume/ average | 591,000 / 5.6m |
Sector | Technology | Dividend | N/A |
Salesforce is a San Francisco-based cloud software company that provides customer relationship management services and business applications.
CRM after the high of $ 312.00 touched in November 2021 has begun a gradual decline that we believe will soon find a phase of consolidation and possible reversal to the upside.
Price
Analyzing the current price, we can see how the price has interrupted the bearish descent on the $ 180 - 190 price range: this area in 2020 played a role of strong resistance in which a marked trading volume can be seen.
The recovery of the last few weeks has broken the bearish trendline in place since November 2021: we believe that this break can only be relevant if followed by a consolidation phase, in order to avoid the scenario of early February which had instead led to a "false -breakout "
Should the stock begin to reverse to the upside, we may see CRM re-enter the side channel between $ 210 and $ 250, which has numerous points of intersection.
Indicators
Looking at the MACD and RSI indicators: both show a positive divergence with the price. Despite a sharply falling price, we can see in the indicators a consolidation phase from December 2021 and a sequence of rising lows.
On the weekly chart we can instead see the oversold RSI
We can therefore see that in the MACD and RSI indicators there seems to be a progressive recovery of the stock.
Moving averages
The 9 and 50 day moving averages, on the daily chart, can give us indications on possible short to medium term fluctuations. At the moment we can see that the stock in the last week managed to stay above the 9-day average: this could herald a possible change of direction.
Reaching the 50-day average, currently at $ 225-230, could instead represent further confirmation of a change in trend and a possible area in which to increase exposure to CRM.
Conclusions
At the current price, we believe that CRM is at a crossroads where it can continue the downward swings or gradually form a basis for an upcoming bullish reversal.
In particular, we believe that if CRM manages to consolidate above the 9 average and keep the price between $ 210 - 220, this price range can be a good starting point for building a long-term buy position.
Subsequent confirmation could then be given upon reaching $ 240.00.
In the event that the stock fails to consolidate between $ 210-220, we could see a further decline where we would identify the large area between $ 160-180 as a possible target and entry range.
Entry range $ 210 - $ 220.00
Target 1 $ 250.00
Target 2 $ 300.00
Stop loss $ 180.00
Graphs
OTB Global Investments
4 March 2022
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