“The charts, as interpreted by Carolyn Boroden, suggest that Apple, Tesla and Microsoft might flatline for a bit here, or even pull back slightly as they brush up against resistance levels, but she recommends buying them into any weakness and believes their charts remain long-term bullish,” the “Mad Money” host said.
Boroden decided to focus on Apple, Tesla and Microsoft after seeing a bullish pattern of higher highs and higher lows in the stocks, along with a five-day and 13-day exponential moving average crossover, according to Cramer.
To start his explanation of Boroden’s analysis, Cramer first examined Apple’s daily chart.
Boroden noted that Apple’s last rally appears to have created a ceiling of resistance at around $173, and that ceiling needs to be cleared before Apple’s run-up can continue, Cramer said.
He added that Boroden believes if Apple can rally less than a dollar and stay up, the price could then go up 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 could change directions.
Boroden also sees five Fibonacci timing cycles coming due between today and Friday, which means Apple’s more likely to change its trajectory during that period. In other words, the iPhone-maker’s stock could be heading for a decline.
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.