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Texas Instruments Faces Critical Death Cross as Q4 Earnings Loom – What Should Investors Expect?

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Texas Instruments Faces Critical Earnings Test Amid Technical Signals TXN will announce its fourth quarter earnings on Thursday after the market closes, raising concerns with a looming potential Death Cross.

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Chart created using Benzinga Pro

The stock is trading just under its 50-day and 200-day moving averages, positioning the semiconductor leader at a crucial juncture amidst positive sector trends yet increasing macroeconomic worries.

Read Also: Analyst Sees China as ‘Increasingly A Risk’ for Semiconductor Stocks Ahead of Earnings

Understanding the Potential Death Cross

A Death Cross occurs when the 50-day moving average dips below the 200-day moving average, which is often seen as a bearish indicator. Currently, TXN stock sits at $195.23, close to its 50-day simple moving average (SMA) of $196.34 and its 200-day SMA of $195.40.

While there has been some buying interest, the MACD indicator shows a negative 0.32, pointing to a downturn in momentum. Should these indicators align after earnings, it might signal a long-term decline.

Anticipating Q4 Earnings Results

Wall Street estimates the fourth quarter earnings per share (EPS) to be $1.20, with revenue projected at $3.87 billion, according to Benzinga Pro data.

As semiconductor companies report mixed results, investors will be attentive to any forward-looking statements that could shift market sentiment.

A robust earnings report could counteract the negative technical signals, whereas disappointing outcomes may reinforce a downward trend.

Balancing Strategic Growth with Market Challenges

Despite the uncertainty in the near term, Texas Instruments remains strong over the long haul. The company’s focus on expanding 300mm manufacturing aims to enhance efficiency and cost-effectiveness.

Growth in its automotive division, particularly within China’s electric vehicle sector, has provided some buffer against weakness in the broader industrial market. However, with industrial declines surpassing 30%, the upcoming earnings call must clarify whether automotive performance can adequately meet overarching demand concerns.

Investor Considerations: Expecting Market Fluctuations

At present, TXN stock is at a critical decision point. If earnings outperform expectations, the stock could shed fears of a Death Cross.

Conversely, if guidance underwhelms, the bearish trend may intensify, increasing selling pressure. Traders might capitalize on heightened volatility, while long-term investors may prefer to await clearer technical signals before acting.

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