Skip to main content

NXP Semiconductors Looks Ready to End Its Consolidation With Earnings at Hand

The technical signals of the semiconductor maker are positive as it prepares to release its third-quarter results.
Comments

NXP Semiconductors (NXPI) is expected to report its third-quarter results after the close of trading here on Monday. Let's see how the charts look for this semiconductor maker.  

In this daily bar of NXPI, below, we can see that prices have traded in a sideways consolidation pattern since March. The lower end of the pattern has been the $180 area and the upside the $220 zone. Prices broke below the 50-day moving average line and the 200-day line in September and early October, but now NXPI is back above the 200-day line and just below the 50-day average. The On-Balance-Volume (OBV) line has been relatively flat since March and that is pretty typical for a consolidation pattern. The Moving Average Convergence Divergence (MACD) oscillator has crossed to the upside from below the zero line for a cover shorts buy signal. 

Image placeholder title

In this weekly Japanese candlestick chart of NXPI, below, we can see a small hammer pattern in early October to mark a bottom reversal. Prices have firmed and are very close to closing above the 40-week moving average line. The weekly OBV line has been neutral since March but shows a turn to the upside in October. The MACD oscillator is narrowing toward a new buy signal. 

Image placeholder title

In this daily Point and Figure chart of NXPI, below, we can see a potential upside price target in the $246 area. 

Image placeholder title

Bottom line strategy: I have no special knowledge about what NXPI is going to report, but the charts are positive and NXPI looks ready to break out of its long sideways consolidation pattern. Traders could go long here risking $185. The $246 area is our price target for now.

Employees of TheStreet are prohibited from trading individual securities.