Salesforce.com (NYSE: CRM) rallied higher on Wednesday morning after posting earnings that beat Wall Street expectations.
How much higher can the stock trade over the near-term?
Our view is that it is likely to trade into its overhead resistance zone, before declining once more.
Our analysis is based on the stock’s market cycles.
Viewed as such, Salesforce (CRM) has now begun the rising phase of its current cycle, which is timely based on our work. Yet the previous cycle fell below the point from which it started, which indicates a new negative trend is now in place.
Given this, CRM is likely to fail at the resistance zone between $137-$142. In that zone, we believe the stock is a good sell, with likely further declines into early 2019.
Salesforce.com (CRM) Stock Weekly Chart
The cloud software company reported earnings per share of $0.61 and total revenue of $3.39 billion, above analyst estimates of $0.50 and $3.37 billion. For Q4 and FY19, management’s forecast for earnings and revenue beat analyst estimates.
A beaming Marc Benioff exclaimed, “That was fabulous third quarter. It was all about the cloud, artificial intelligence, machine learning, and deep learning.”
For more from Slim, or to learn about cycle analysis, check out the askSlim Market Week show every Friday on our YouTube channel.
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Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
