ON Semiconductor Is Poised to Keep ON Going Higher

The stock is edging up towards an important breakout.

ON Semiconductor (ON) has been showing superior relative performance versus other chipmakers. Let's check out the charts and indicators to see if this current movement can be sustainable.

In the daily bar chart of ON, below, we can see that the shares have traded sideways to slightly since November. The long consolidation pattern shows more downside tests than upside tests and thus the path of least resistance is going to be up, in my opinion. Prices tested and broke the rising 200-day moving average line in April and May but now prices are firmly back above this longer-term indicator.

Despite the sideways movement of ON, the daily On-Balance-Volume (OBV) line has been climbing and is acting as a leading indicator. We should see ON break out to new highs soon. The trend-following Moving Average Convergence Divergence (MACD) oscillator is in a buy signal as it has moved above the zero line.

 

In the weekly Japanese candlestick chart of ON, below, we can see that the shares are in a longer-term uptrend. The stock is pushing up into some minor overhead resistance in the $65-$70 but I suspect it will break through.

 

The 40-week moving average line has a positive slope and the OBV line is strong. The MACD oscillator is crossing to a new outright buy signal.

 

 

In this daily Point and Figure chart of ON, below, we can see a potential upside price target in the $75 area. A trade at $69 should refresh the uptrend.

 

 

In this weekly Point and Figure chart of ON, below, we can see a potential longer-term price objective in the $99 area.

 

 

Bottom-line strategy: Aggressive traders could go long ON at current levels. Risk to $57 for now. Our price objectives are $75 and then $99.

 

Employees of TheStreet are prohibited from trading individual securities.