Danaher Looks Like It Could Stall or Turn Lower

During Jim Cramer's "Mad Money" program on Wednesday night, a caller asked about Danaher Corp. (DHR) .

"This one just continues to rally, and it's not done. Stay long,"  said Cramer.

Let's check out the charts of this science and technology conglomerate and see if there are any targets or appropriate risk points. 

In this daily bar chart of DHR, below, we can see that prices broke out on the upside from a five-month sideways consolidation pattern.

Prices tested the rising 200-day moving average line in early November and gapped above the rising 50-day moving average line in the middle of November. Prices have since continued higher, but the pace of the rise has slowed from late November to January and this can be seen from the lower highs on the 12-day price momentum study. The On-Balance-Volume (OBV) line had a huge move higher in December and trading volume surged for a time, but has since returned to "normal" levels. Prices are in an uptrend, but I would be cautious.  

In this weekly bar chart of DHR, below, we can see that prices made a long consolidation pattern around $100 in 2018, before the stock launched a strong advance in 2019. Trading volume and the OBV line only surged in December and the slow stochastic indicator tells us that prices are "overbought." DHR could continue to rise from here, but the indicators suggest a degree of caution.  

In this daily Point and Figure chart of DHR, below, we can see a potential upside price target around $190. Point and Figure charts focus only on price changes and ignore volume and time.  

Bottom line strategy: With prices losing upward momentum and overbought when using the stochastic indicator, I would take a cautious stance on DHR. Longs could be held with an appropriate sell stop, but I would not get aggressive at this juncture.

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