Texas Instruments (TXN) Stock Slips To Key Support Level

Texas Instruments (TXN) stock price has been on a downtrend since the end of July after the second quarter earnings result was released. The stock price formed an annual high at $188.17 and started to decline due to the strong presence of bears.

Texas Instruments reported second-quarter earnings results on 25 July 2023. The company successfully crushed the consensus estimates of earnings per share and revenue.

TXN reported earnings per share of $1.87, beating the estimates by 6.2%. The revenue was $4.53 Billion, while the consensus estimated it to be $4.36 Billion. Even after beating the estimates, there was a substantial decline in the stock price as revenue decreased 13% from the prior year’s quarter’s level. A weak demand environment caused the year-over-year decline.

Possibilities For Texas Instrument Stock Price

Texas Instrument witnessed a sluggishness in its analog and other segments. TXN stock has reached the support level of $161 and is striving to form support. If the stock price can form a support and gain bullish momentum, it might reach the next resistance level of $171.50. It needs to shatter $171.50 to retest the annual high.

On the other hand, if TXN stock price melts below $161, it might head toward the next fundamental support level of 152.50, causing a downfall of 5.27%.

For quarter 3, the consensus has estimated the earnings per share to be $1.91 on 4.59 Billion in revenue. For the current fiscal year, the earnings per share is estimated to be $7.47 on $17.49 Billion in revenue.

Will TXN Stock Stay Above $161?

The stock price has plunged below 20, 50, 100, and 200-day exponential moving averages, suggesting bearish momentum. The Chaikin money flow score melted below the 0 mark and currently stands at -0.11, indicating weakness and capital outflow from the market. CMF has been trading below the 0 mark since 15 September.

The relative strength index has also dropped below the 50 mark and currently stands at 38.53, nearing the oversold zone, suggesting increased sellers’ participation in the market.

The bands of Bollinger have also contracted, indicating a decrease in volatility. TXN stock price has reached near its lower band which suggests the possibility of a short-term pullback.

Conclusion

Macroeconomic challenges across its end markets caused Texas Instrument’s slowdown. On a sequential basis, TXN’s revenue rose sequentially in the second quarter of 2023, driven by the quarter-over-quarter recovery of its automotive and personal electronics markets. Texas Instruments’ price action and market structure are currently indecisive as the price is hovering near the support level.

Technical Levels

Major support: $161 and $152.50

Major resistance: $180 and $187

Disclaimer

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