In our last review of Cypress Semiconductor (CY) earlier this year, we said, "An upside breakout could happen at any time, but the current price picture and indicator development suggest further sideways price action, at least for now."
Putting on our "hindsight eyeglasses," we can see (check the first chart below) that prices broke out on the update later in January and made a peak in late March. Prices traded sideways from April through June but look poised now for renewed strength.
In this updated daily bar chart of CY, above, we can see that after a four-month consolidation pattern, it looks like CY is poised to trade higher again. CY is above the rising 50-day moving average line. The most bullish-looking indicator right now is the On-Balance-Volume (OBV) line, which turned up in early May and has made a new 12-month high, suggesting that buyers of CY have been more aggressive the past three months. This buying looks like it is foreshadowing a sustained move up above $15.
The daily Moving Average Convergence Divergence (MACD) oscillator has crossed above and below the zero line many times in the past four months, and while it is above the zero line, this is not a robust signal.
In this weekly bar chart of CY, above, we can see that prices are above the rising 40-week moving average line. The weekly OBV line moved to a new high last month and the weekly MACD oscillator is turning upward to a fresh outright go-long signal above the zero line.
In this Point and Figure chart of CY, above, we can see a recent trade at $15 was a breakout on the upside and projects a potential price target or objective of $19.
Bottom line: A bullish daily and weekly OBV line signals aggressive buying of CY the past few months. Traders could approach CY from the long side, risking below $13 and looking for a rally to the $19 area.