Like Chipotle, shares of Del Taco, a small-cap, more speculative Mexican food chain, have recovered handsomely since their March lows, gaining nearly 25 percent.
Lang liked the strength he saw in this chart’s Relative Strength Index. More importantly, he liked that Del Taco’s moving average convergence-divergence indicator, which predicts changes in a stock’s trajectory before they happen, made a bullish crossover in April.
The crossover, depicted by the black line in the chart above crossing over the red one, sent shares of the 300-restaurant eatery even higher.
“But Lang believes that Del Taco could have even more upside,” Cramer said. “While the stock is approaching the ceiling of resistance from where it gapped down in March — at $12.50, right near the 200-day moving average — Lang believes it can make a run at that level and then push higher.”
“As he sees it, the path of least resistance takes Del Taco to just under $14. That’s roughly 13 percent from these levels,” the “Mad Money” host added. “I like that call.”