Texas Instruments is looking vulnerable again for another potential breakdown

Texas Instruments major uptrend since 24 Dec 2018 at risk of being damaged.

Medium-term technical outlook on Texas Instruments (TXN)

click to enlarge charts

Key Levels (1 to 3 weeks)

Intermediate resistance: 120.75/122.10 (lower limit of gap resistance).

Pivot (key resistance): 132.20

Supports: 116.80 (trigger), 102.30 & 88.30

Next resistance: 138.20/140.60

Directional Bias (1 to 3 weeks)

Bearish bias below 132.20 pivotal resistance and a break below 166.80 is likely to open up scope for a potential multi-week corrective decline to target 102.30 and even 88.30 next within a long-term secular uptrend.

However, a clearance with a daily close above 132.20 sees a continuation of the impulsive upleg sequence to towards the next resistance zone at 138.20/140.60 (Fibonacci expansion cluster).

Key elements

  • After its 9% gapped down seen on 23 Oct 2019 on the backdrop of a dismal Q3 earnings results and sombre outlook, the share price of TXN has traded sideways with several retest on the lower of the gap resistance at 120.75/122.10
  • Medium-term momentum remains bearish as indicated by both the weekly/daily RSI oscillators.
  • The 116.80 downside trigger level is defined by the recent swing low area of 23/31 Oct 2019 and the major ascending support from 24 Dec 2018.
  • Relative strength analysis as indicated by the ratio charts of TXN against the market (S&P 500) and its sector (Semiconductors) are showing underperformance of TXN.

Charts are from eSignal 

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