Ocugen’s charts suggest that we are looking for a better buying opportunity

Here’s what Jim Cramer had to say about some of the stocks that callers were offering during the Crazy money “Lightning Round” Tuesday night – Ocugen (OCGN): “This is good speculative stock,” Cramer told the caller. The company used to be called Histogenics Corp. and is a clinical-stage biopharmaceutical company focused on discovering, developing and commercializing a pipeline of therapies for eye diseases.

Let’s “see” what the graphs show.

In this daily Japanese candlestick chart from OCGN, below, we find some interesting clues. Prices were flat before mid-December. Prices and trading volume come to life at the end of December. Prices float lower for much of January, correcting the December population, but prices explode again in early February. OCGN climbs from $ 2 to $ 18 in a few sessions with a big price gap that has since filled in.

On light volume and a flat On-Balance-Volume (OBV) line, prices have given up many of the gains and are trading below the top 50-day moving average. The 12-day price momentum study does not show us a clear bullish divergence yet to suggest the pullback is over.

In this weekly bar chart from OCGN, below, we went back three years and had to use a log scale to correctly represent the price movements. Prices bottomed out for much of 2020 before the recent upward move. The rally encountered selling resistance in the USD 15 area, which is not surprising in that area, given that it was support in 2019. Prices are above the upward trajectory of the 40-week moving average.

The weekly OBV line is showing some weakness over the past two months, suggesting that some traders were more aggressive sellers as they approach the USD 15 area. The MACD oscillator is too difficult to read on this scale.

In this daily OCGN chart with dots and numbers, below, we see a possible downward price target in the $ 1.50 area. Au. Card support starts at $ 3.50.

In this weekly Point and Figure chart from OCGN, below, we see a downward price target of $ 2.50. It takes a weekly trade at $ 19 to turn the chart bullish.

Bottom line strategy: Eye disease is likely a growing industry given the demographics in the United States and other developed countries. (I called yesterday for an appointment with our ophthalmologist and he’s now booking in June.) Unfortunately, OCGN’s charts are now pointing down. Let’s stay on the sidelines until a fresh and sustainable foundation is created.