INFINEON TECHNOLOGIES AG (IFX)

Technical analysis

Price	€ 27.01	52 weeks range	€ 25.27- € 43.76
Beta	1.51	Volume/ Average	2.065/ 15.310
Sector	Technology	Dividend	1.03%

Infineon Technologies AG is a German semiconductor manufacturer founded in 1999, when the semiconductor businesses of the former parent company Siemens AG were spun off. It is one of the ten largest semiconductor manufacturers in the world.

Price

We can see that in both March and May 2022, th sell-off stopped at € 25.50, the strong resistance level (now support) that has characterised IFX since November 2017.

By slightly broadening the spectrum, we believe that the € 23.50-25.50 range can represent a support area where ideally the stock could progressively slow down and reverse upwards.

On the weekly chart, it is possible to better appreciate how the area of € 23.50-25.50 can play the role of support and / or "bottoming" of the current price action.

From this graph, the price ranges that have characterised the stock from 2015 to today are even better understood and the importance of the near future is emphasised by noting how the narrow € 23.50-25.50 range represents a watershed between an upward reversal or a bearish continuation.

Indicators

Looking at the MACD and RSI indicators: both show a positive divergence with the price action by comparing the levels of March and May, where at a lower price we had higher indicators.

On the weekly chart, we see a strong downward extension of these indicators, shifting the risk/reward of the stock more in favour of possible price recoveries.

Moving averages

We believe that the strong watershed for short-medium-term direction is in this case the 50MA (yellow line): in recent months the latter has played the role of "dynamic resistance", rejecting any possible upside of the stock. We believe that only a break of it could be read as a trend change.

On the weekly chart, we want to examine the 200MA (green line) which emphasises even more the previously highlighted price range.

The stock is currently on the long term MA, which has played a supporting role in the past.

Conclusions

At current price IFX represents an interesting stock to start monitoring: being on a well-defined bearish trend, we believe it is appropriate to wait for future price confirmations before evaluating long positions.

We are in favour of wait a price confirmations precisely because a possible break of the € 25.00 level, we believe, could lead the stock to further declines.

Price confirmations that we believe may coincide with exceeding the 50MA between € 28-30.00.

Regarding price targets, we believe that conservative objectives can be found in the previous levels reached by the stock at € 36.00 and € 43.00

Entry range € 28 - € 30,00

Target 1 € 36,00

Target 2 € 43,00

Stop loss € 22,00