Buy the Dip on This Sinking Apple Supplier

Skyworks stock's recent pullback could be a buying opportunity

Managing Editor
Dec 14, 2017 at 3:01 PM
facebook X logo linkedin

Since touching a record high of $117.65 in early November, the shares of Skyworks Solutions Inc (NASDAQ:SWKS) have dropped 19%. However, in the wake of the recent pullback in Apple suppliers -- exacerbated by bearish analyst attention today -- SWKS stock could be flashing a big "buy." Below, we'll take a look at the technical signal that's preceded pops for the tech stock in recent history.

SWKS stock recently came within one standard deviation of its ascending 320-day moving average, after a lengthy stretch above this trendline. One month after the last five pullbacks of this kind, the equity was higher 75% of the time, and up an average of 8.34%, according to Schaeffer's Senior Quantitative Analyst Rocky White.

Skyworks stock is was down 1% at $94.84, at last check, after analysts at Cowen waxed pessimistic on Apple suppliers. Specifically, Cowen cut its price target on SWKS stock to $115 from $120, citing concerns about lackluster iPhone demand. Another 8.34% rebound from current levels would put the currently oversold shares around $102.75 -- back above the century mark.

Daily Chart of SWKS Since Jan 2017 with 320 MA

Meanwhile, at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHL), SWKS sports a 10-day put/call volume ratio of 1.37, ranking higher than 87% of ratios in its annual range. This suggests that puts have been purchased over calls at a faster-than-usual clips during the past two weeks. An unwinding of the recent pessimism in the options pits could also be a boon for Skyworks stock.

Despite the equity's long-term uptrend, short interest represents nearly a week's worth of pent-up buying demand, at SWKS' average daily trading volume. Should the equity once again bounce off its 320-day moving average, an exodus of shorts could also translate into tailwinds for the shares.

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI