Texas Instruments (TXN) is a designer and manufacturer of semiconductor products. Its main products are analog chips and embedded processors. The industrial and automotive industries account for a majority of TXN’s customers. With increasing automation of industrial processes as well as higher use of electronics in vehicles, the company’s prospects look bright.
The long-term uptrend of the stock is clearly visible on a snapshot of the 20 -year monthly chart. More recently, the stock fell about 22% from January 2020 to March 2020. In March 2020, the price went below the bottom of the long-term trend and stayed above support level formed in January 2019 (as indicated by the dotted red line).
However, in April, there has been a turnaround. The price pulled back almost 18% from its monthly low and crossed the bottom of the long-term trend (shown by the bottom yellow trend line). Price also stayed above the support level at 92.50 the dotted red line.
Currently the price is poised to test the 130 level, which acted as resistance in the past, and then potentially the top of the long-term trend at 145.
Position taken at $114.22 with stop loss 23.8% below at $87.06. Take profit set at top of long-term trend lines at $145 represents 27% profit.
This is a good stock for the long term.