Skyworks Solutions Inc. (SWKS) is trying to break out of a six-month consolidation pattern. With higher price targets seen on our Point and Figure chart and good support nearby we want to trade SWKS from the long side. Our longer-term chart suggest new all-time highs lie ahead. Interested?
In this daily bar chart of SWKS, below, we can see that prices traded sideways between $95 and around $110 from April. The 50-day simple moving average line turned sideways from up and prices crossed above and below it several times until late October when prices and the slope of the 50-day average turned up. The 200-day average line line has had a positive slope the past 12 months and prices dipped near the line in late September. In hindsight that dip looks like a buying opportunity.
The On-Balance-Volume (OBV) line, above, shows a gradual uptrend the past year signaling more aggressive buying. The Moving Average Convergence Divergence (MACD) oscillator was holding around the zero line for several months but has turned up for a buy signal.
In this weekly bar chart of SWKS, below, we can see that prices are above the rising 40-week moving average line and the line was successfully tested in September. Prices are testing/breaking the 2015 highs. The weekly OBV line has been steady and is not far from making a new high to confirm the advance. The weekly MACD oscillator has been in a bearish mode above the zero line since June but it looks poised for a bullish crossover and fresh buy signal.
In this Point and Figure chart, below, we can see a breakout on the upside at $111.98 and a pullback to the top of the trading range. The chart also shows a possible upside price target of $137.94 and good support beginning at $106.54.
Bottom line: Risking a close below $104 I would look to buy SWKS at current levels and on strength above $115 looking for gains to the $135-$140 area into year-end.