Texas Instruments (TXN) was reviewed last week, and I concluded that, "TXN has been in a strong uptrend since late 2015. Prices have traded sideways for about four weeks, but I would anticipate that the rally will resume and our price targets of $100, $125 and $135 can be reached in the months ahead."
TXN has nearly reached our first target of $100, so will we race ahead to $125, $135 or will take a pause first? Let's view the latest charts and indicators.
In this daily bar chart of TXN, below, we can see prices are still above the rising 50-day and 200-day moving average lines. Volume (right below the price chart) has slowed since late October and the daily On-Balance-Volume (OBV) line has turned flat this month. A rising OBV line would tell us that buyers were more aggressive and a declining line would suggest sellers were more aggressive.
In the lower panel is the 12-day momentum study, which shows a bearish divergence since late September -- momentum has been declining while prices have risen. The pace of the rally has slowed.
In this weekly bar chart of TXN, below, we can see the rally over the past three years. Prices are well above the rising 40-week moving average line. Maybe too far above the line. The volume pattern has been flat to declining for months and the weekly OBV line has also turned flat this month. The weekly Moving Average Convergence Divergence (MACD) oscillator has begun to narrow and the histogram of the oscillator has peaked. A crossover of these two averages would be a take-profits sell signal should it occur.
In this Point and Figure chart of TXN, below, we can see the long straight-up rally as well as a bullish upside price target. Prices could use a period of sideways price consolidation before heading still higher.
Bottom line: One hundred dollars is a nice round number, and sometimes round numbers can act as resistance. TXN has made a strong run-up and a period of sideways consolidation would be in order before our $125 and $135 price targets are reached.