Semtech (SMTC) reached a significant support level, and could be a good pick for investors from a technical perspective. Recently, SMTC broke through the 50-day moving average, which suggests a short-term bullish trend.
One of the three major moving averages, the 50-day simple moving average is commonly used by traders and analysts to determine support or resistance levels for different types of securities. However, the 50-day is considered to be more important since it's the first marker of an up or down trend.
SMTC could be on the verge of another rally after moving 13.5% higher over the last four weeks. Plus, the company is currently a Zacks Rank #3 (Hold) stock.
The bullish case only gets stronger once investors take into account SMTC's positive earnings estimate revisions. There have been 7 higher compared to none lower for the current fiscal year, and the consensus estimate has moved up as well.
With a winning combination of earnings estimate revisions and hitting a key technical level, investors should keep their eye on SMTC for more gains in the near future.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
