Qualcomm is breaking out this week:


Qualcomm began this week with a break above a very heavy overhead trendline that has been in place since the May peak.  The stock’s June and July highs were also linked to this key area.  This impressive move, which corresponds with positive EU news , is leaving behind a very solid base and could be just the initial stage of a powerful bull run.

In the near term we view QCOM as a low risk buy near current levels.  The stock has a strong support in place from the $53.00 to $52.00 area.  This key zone includes the stock’s September peak as well as last week’s high.  On the downside a close back below $51.50 would violate the October lows sending a clear warning sign that this week’s breakout has failed.  Initial upside target is QCOM’s declining 200 day moving average just below $56.00.  It’s likely the stock will need to consolidate before this heavy supply zone is cleared. 

Also of note, QCOM sports a very attractive dividend yield of 4.3%. 

Earning are due(Q4)are due November 1.

At time of this writing we are long QCOM in some managed accounts.