Semiconductor manufacturer Qualcomm (QCOM) was upgraded by a sell-side firm Monday to "overweight" from "equal weight" (buy from hold) with a bump up in their price target to $150.
Let's check on the charts and see if the technicals are aligned with the upgrade.
In the daily bar chart of QCOM, below, I can see that the shares have made a small bottom pattern since October. Prices have turned sideways and have rallied above the 50-day moving average line and could well close above the 200-day line Monday.
The On-Balance-Volume (OBV) line has improved from a low in late December. The Moving Average Convergence Divergence (MACD) oscillator has crossed above the zero line for an outright buy signal.
In this weekly Japanese candlestick chart of QCOM, below, I can see some improvement. The shares have found some buying interest (support) in the $110-$100 area. Prices are approaching the declining 40-week moving average line.
The weekly OBV line has turned (so far) up from late December. The MACD oscillator is off its worst levels.
In this daily Point and Figure chart of QCOM, below, I can see an upside price target in the $175 area.
In this second Point and Figure chart of QCOM, below, I used weekly price data. Here the software shows a $175 price target too.
Bottom-line strategy: In my January 3 review of QCOM I wrote that, "Shares of QCOM are poised to retest their November lows, which could open the way to further declines. Avoid the long side of QCOM." The charts have improved and traders could begin probing the long side. Stay nimble as broader market weakness could derail QCOM's gains.
