Shares of semiconductor maker (and Action Alerts PLUS holding) Qualcomm (QCOM) have rallied Monday on the heels of news that Apple (AAPL) has extended their chip contract to 2026, but that may not be the most important fundamental news that investors are focusing on now.
Let's check the charts.
In the daily bar chart of QCOM, below, I can see that the shares have gapped higher Monday but those early gains are eroding and a weak close would not surprise me. The shares are trading below the declining 50-day moving average line and below the declining 200-day line.
The On-Balance-Volume (OBV) line shows a drift lower the past 12 months. The Moving Average Convergence Divergence (MACD) oscillator is in a bearish alignment below the zero line.
In the weekly Japanese candlestick chart of QCOM, below, I see a chart that is struggling. Prices trade below the declining 40-week moving average line.
The weekly OBV line is showing new weakness the past four weeks. The MACD oscillator is moving lower below the zero line.
In this daily Point and Figure chart of QCOM, below, I can see a downside price target in the $83 area.
In this weekly Point and Figure chart of QCOM, below, I can see the same price target as the daily chart above -- $83.
Bottom-line strategy: The charts of Qualcomm looked weak on September 8 and they still look weak. Continue to avoid the long side of QCOM.
(QCOM and AAPL are holdings in TheStreet's Action Alerts PLUS portfolio. Want to be alerted before the portfolio buys or sells these stocks? Learn more now. )
