Some of the younger technology stocks were red-hot on Tuesday, but Jim Cramer said some of the old-school tech plays still have life in them.
To figure out what the charts predict for these stocks he spoke with Tim Collins, a technician and colleague of Cramer's at RealMoney.com.
Networking equipment giant Cisco is set to report earnings next week, and Collins thinks it could be a high-risk high-reward situation if investors buy the stock ahead of the quarter. Collins found a solid floor of support for the stock at $29 and a ceiling of resistance at $31.50.
Collins expects the stock to either break out to the upside or break down. If the stock can push past above $29, he thinks it could be smooth sailing to $34 or $35. If it pulls below $29, he recommended selling it instead of waiting for a potential breakdown.
He also looked at the Chandelier Exit, a volatility-based tool that helps technicians figure out when to ride out a trend and when to sell. Collins found that Cisco is standing above the warning lines on the Chandelier, which suggested that the stock could have more room to run.
Electronic manufacturer Jabil Circuit has been consolidating after a big move and Collins spotted a cup-and-handle formation, which is one of the most reliably bullish indicators out there. Collins believes that if Jabil can make its way a bit higher and close around $24.50, the next stop could be $27.50 or $30 by the end of 2017. However, he said to be concerned if the stock falls below $21.50.
The last chart Collins looked at was for Oracle, which surprisingly had the strongest trend of all three old-school tech names. He thinks it could be ready for a powerful break out of its $40 ceiling if resistance that has held it back.
Ideally, Collins would like to see Oracle close above $40.50, which would indicate an all clear trigger to buy the stock. He thinks he could rally up to $43.50 with a possibility of going to $45.
The one caveat is that Oracle has been a tough stock to own whenever it trades below its 40-week moving average, thus Collins advised to be wary if it pulls back below this key level.
Ultimately, Collins found that Cisco, Jabil and Oracle all have strong charts right now.
"I wouldn't be surprised if he is right that they have got more upside here," Cramer said.
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