SUN 12/25: MaxLinear, Inc. (MXL – NYSE) – PORTFOLIO UPDATE

PROFILE: MaxLinear, Inc. provides integrated, radio-frequency (RF) and mixed-signal circuits for broadband communication and data center, metro, and long-haul transport network applications worldwide.

This stock was most recently added to the High-Ranked Leaders WatchList on 2/5/16 as its shares were setting up in a base.

The stock broke out on 3/4/16 as shares traded above the TRIGGER PRICE of $17.85 while the day’s volume was well on pace to make the TRIGGER VOLUME. This bullish action always confirms a BUY signal.

Later that day MXL did trade back below its TRIGGER PRICE, and this may happen on occasion.

As I noted that weekend – “…if you bought the breakout earlier that day, you are following the rules, and doing it right. You should now treat this like any other trade, and watch Monday’s action for any signs of weakness. An initial indication would, of course, be if the stock continues to pull back with an increase in volume.”

Charts courtesy of StockCharts.com

LATEST ANALYSIS 12/25: This holding has been in a steady uptrend since the stock found support at its 200-day moving average on 12/1.

Since losing -11% the week before that uptrend began, the stock has consecutively closed higher week-after-week, +6.9%, +3.1%, and then another +3.7% this past week.

Shares made some decent price progress on Monday with session gains of +4% backed with a +37% increase in volume.

As I noted here last weekend, it is important to realize that although those are some bullish points (weekly gains, uptrending, finding support) the advance from support for the most part has lacked volume conviction.

The daily trading volumes have been below average for every session on the move higher (except this past Monday’s), and still the two biggest volume days were down days.

This remains a growing concern as shares are at resistance of the previous highs (top blue line on the chart below at $22.30).

As I have been noting continuously in my daily afternoon updates to all Personal Portfolio Members (here) – “Shares are at resistance of the previous highs.”

At this point, our 1st SUPPORT remains the rising 200 DMA ($19.47), and any considerable trading below there or a close below there would be the FINAL SELL SIGNAL.