Semiconductor stocks and stocks related to the semiconductor industry have been on fire the last year. I have written about several of the stocks in this sector, including the likes of Advanced Micro Devices (AMD), Himax Technologies (HIMX) and nVidia Corporation (NVDA). Most recently I penned an article for ASML Holdings (ASML) and their new technology to help make semiconductors smaller and continue Moore’s law.

I believe that Himax Technologies is still a holding for a Trendy Stock Charts member so let’s get an update on the company and its share price performance.

Himax Technologies (HIMX)

This first chart for Himax Technologies (HIMX) is a 5 year monthly candlestick chart. Let’s review the longer-term trend underway with this perspective.

The first item I notice is that the buying momentum is starting to slow down in October 2017 according to the MACD Histogram indicator. This is highly expected after an initial break of an overhead resistance area. Buyers usually pause to try to make sure there are not a bunch of sellers waiting for them on the resistance break.

Any pullback to the[s2If !current_user_can(access_s2member_level1)]……

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Support areas are reviewed based on a probable continued pullback. Those support areas could be used as an entry to go long the stock as its charts have some bullish action taking place.

If you are not a Trendy Stock Charts member, consider joining today! There are several different subscription plans available.[/s2If][s2If current_user_can(access_s2member_level1)] overhead supporting trendline during October or November should be seen as a buying opportunity, as long as the selling volume is moderate to light. The overhead resistance trendline sits around the $8.50 area. HIMX’s share price pulled back to the $9 level already in October.

The blue Fibonacci Extension Tool that is placed on the new uptrend suggests a $14.17 bullish price target. Any shares bought around the $8.50 price level could pay off handsomely in the next 3-4 months.

HIMX – Downtrend Channel Test Results

This next chart is a 3 year weekly candlestick chart for Himax Technologies (HIMX). The chart reflects the aftermath from the “Downtrend Channel Test”.

Notice that purchasing shares on a pullback to the top of the Downtrend Channel can yield some great results. While you do miss some upside waiting for the pullback to the top of the channel, you also eliminate some of the risk associated with going long the stock. It has “proven” itself at that point that its uptrend is real and should be taken seriously.

HIMX – $1 Trading Range

This last chart for Himax Technologies is a 1 year weekly candlestick chart to analyze the current uptrend in a little more detail. The black Fibonacci Extension Tool on this chart is the same one as the blue tool on the above 5 year monthly chart. I just have them colored differently on the 2 different charts. I usually save multiple settings for each stock that I analyze.

The main supporting trendline for the current uptrend sits around the $8.75 price level. This supporting trendline intersects with a support area from a Rising Window candlestick pattern at that price. The “window” from the Rising Window is still open. In English, the gap is still open. An open gap will at least provide an initial wave of support at that price level.

There is an approximate $1 Trading range between the Rising Window candlestick pattern’s support area and a resistance area above from a Falling Window candlestick pattern. The support area should be used to purchase shares. A break below the $8.75 support level or above the $10 resistance level will most likely result in another quick move of $1. That means make a second purchase of shares on any break below the $8.75 area around $7.75 if a break does occur. Those are 2 potential scale-in areas.

When a new uptrend develops, a simple strategy to follow is this: purchase shares every time there is a pullback to the main supporting trendline. End of story. Technical analysis doesn’t always have to be complicated. Sometimes a solid but simple strategy works. I think this is one of those strategies.

HIMX – Point & Figure Charts

A Point & Figure chart can help to provide confirmation to your analysis with its price projections. In some cases, it may even make you rethink about the analysis you were so sure about. Which is not a bad thing. Here are the price targets for the 2 P&F  Charts:

High/Low P&F Chart – $7 Bearish Price Objective

Closing P&F Chart – $19.50 Bullish Price Objective

Those price targets are a vast difference from when I reported on them a couple months ago. Both the High/Low and the Closing P&F Charts reflected bearish price targets of $0. Yes, $0. That article can be quickly accessed here:

“6/16/2017 – Himax Technologies (HIMX) Stock Chart Review”

Even with the $0 price targets, I mentioned to purchase any pullback as long as the $6.50 area held as support. Consider saving a little cash for any drop below the $8.50 area from the overhead resistance trendline. The P&F High/Low Chart suggests $7. Being a High/Low Target means there could be less time to react to the price if it does happen. Being knowledgeable is being prepared.

Himax Technologies (HIMX) – Summary

Continue to stay long Himax Technologies (HIMX) for the next couple months at least. The $13.50 – $14.25 price range looks to be the target area for the rebound from any continued pullback. Use any continued pullback to the $8.50 area or below as an opportunity to either repurchase any sold shares at other price levels or as an opportunity to make your first scale-in purchase for the stock. The upside potential over the next couple of months appears to be quite sufficient…

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