In Wednesday night's "Lightning Round" segment of Mad Money, one caller asked Jim Cramer about Triumph Group (TGI) : "I like it. I think the FAA will let them fly soon," said Cramer about the company that engineers, designs, and manufactures aircraft components, systems and accessories.
Let's check out the charts before take off.
In this daily bar chart of TGI, below, we can see that prices topped out in November/December and did not bottom until the middle of March. We can see some price stability into the middle of May and then a rally into last week. TGI has quickly sunk and could fall further in the days ahead.
Prices are below the declining 200-day moving average line and above the rising 50-day moving average. The daily On-Balance-Volume (OBV) line made a low in the middle of March but did not really respond on the upside until May. The OBV line shot straight up and is giving back those gains as prices fall.
The Moving Average Convergence Divergence (MACD) oscillator turned bullish at the beginning of this month and is already losing momentum.
In this weekly bar chart of TGI, below, we see a mixed to bearish picture. Prices are below the declining 40-week moving average line. The weekly OBV line was in a long-term downtrend until late May when it showed some improvement.
The MACD oscillator is just now crossing to the upside for a cover shorts buy signal.
In this daily Point and Figure chart of TGI, below, we can see a potential upside price target of $24 but a trade at $7.50 is likely to weaken the chart.
Bottom line strategy: TGI is correcting to the downside now and it could decline back into the $6-$4 area as the broad market corrects. Stand aside for now. Let's see where buyers come in and whether we get new signs of aggressive buying.
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