Texas Instruments (TXN) has successfully rebounded after completing a zigzag correction from its July 2025 high. The correction concluded in the blue-box support area, which sparked renewed buying interest and a subsequent rally.
Company’s Leadership in Semiconductor Industry
The company, a leader in the semiconductor industry, designs and manufactures chips integral to numerous technologies. It concluded its grand supercycle wave ((II)) in 2002, launching into a multi-decade wave ((III)) advancement. Wave (I) of ((III)) reached a peak in 2007, followed by a wave (II) downturn that hit December 2008 lows.
TXN’s significant bull phase, wave (III), began thereafter, surpassing a 2000 high and eventually peaking at $202.2 in 2021. After a wave IV correction, the stock hit a new high of $220.38 in 2024. A pullback in a 7-swing sequence formed wave ((2)), ending at the blue-box, before rallying to complete wave (1) of ((3)) in July 2025.
Following a wave (2) pullback, a clean 5-wave decline marked wave C of (2) within the blue-box. The expected rebound resulted in partial profit-taking at $180.8, with projections for wave (3) targeting the 253–284 range, offering further potential gains.
The rebound we saw beginning in the fall of 2025 has confirmed our bullish outlook for Texas Instruments. The stock found strong support in the $165 to $138 price zone and has since moved decisively higher. As of early December 2025, this upward trend appears to be the start of a powerful new impulse wave.
This technical strength is reinforced by fundamental improvements in the semiconductor industry. Recent data shows that global semiconductor sales surged by 12% year-over-year in October 2025, driven by strong demand from the automotive and industrial sectors. This directly benefits TXN and adds credibility to the ongoing stock rally.
Trading Strategies and Milestones
For derivative traders, any minor dips or consolidations in the coming weeks should be viewed as buying opportunities. This setup is well-suited for strategies like purchasing long-dated call options or implementing bull call spreads to leverage the expected climb. The initial stage of the rally is complete, and we are now positioning for the main thrust of the move.
The next major milestone is for the stock to decisively break above the high of $220.38, which it set back in November of 2024. A sustained move past this level would signal an acceleration towards our primary target zone of $253 to $284. Traders with existing long positions should use a trailing stop to lock in gains while aiming for these higher targets.
This price action is very similar to the powerful rally that began after the market bottomed in October 2023. That move also followed a significant correction and resulted in a strong, sustained advance. The current wave structure suggests a rally of similar, if not greater, magnitude is now unfolding.
