In his final "Executive Decision" segment for last week, Jim Cramer spoke with Michael Hurlston, president and CEO of Synaptics (SYNA) , the touch interface technology company that just posted blowout earnings that sent shares up 20.5% by the close on Friday.
Hurlston said that Synaptics only has a limited presence in the automotive industry, but touch screens in cars are getting bigger and they're becoming more prevalent. The same technology that goes into mobile phones and PCs will be coming to cars very soon, he said.
In this daily bar chart of SYNA, below, we can see that prices have been in a strong uptrend since early June. SYNA is above the rising 50-day moving average line and the rising 200-day moving average line. Back in early October we can see a bullish golden cross as the 50-day line crossed above the slower-to-react 200-day line.
Trading volume has turned heavier since early November and tells us that more traders and investors have become involved with the rally - a constructive sign to old tape readers.
The On-Balance-Volume (OBV) line has been rising since May and tells us that buyers of SYNA have been more aggressive for a long time.
The Moving Average Convergence Divergence (MACD) oscillator has been above the zero line since July and is now turning to the upside again for an outright go long signal.
In this weekly bar chart of SYNA, below, we can see that prices endured about a two-year decline before changing direction and soaring to the upside. The weekly OBV line has been strong since June and stands at a new high for the move up. The weekly MACD oscillator crossed the zero line in September and has remained bullish.
In this Point and Figure chart of SYNA, below, we can see a potential upside price target of $122.
Bottom line strategy: SYNA recently gapped higher and it is likely to trade in a tight $85-$80 range for a few days before heading higher again. Aggressive traders could use dips to around $80 to go long, risking a close below $74 for now. The $100 area and then the $122 area are our price targets.
