Freescale Semiconductor is experiencing a downward trend that could push it toward USD 7.7, corresponding to a mid-term support.

From a fundamental viewpoint, the financial situation of the company is worrying with an important debt level. Leverage is at 8.01x for the current year. Analysts have recently downgraded their forecasts for earnings per share. This indicator is often a precursor of a declining profitability and a worsening climate of investor confidence.

Technically, the share is in a downward trend. The moving averages are decreasing and are still above prices, thereby stopping any rebounds. The security is going toward the USD 7.7 support, a level that will represent the first target.

Therefore, we could take a short position to benefit from the downward trend. The security could quickly go toward the next support area located at USD 7.7. A stop loss will be placed above the USD 8.9 mid-term resistance. If this threshold is crossed, this bearish strategy will be cancelled.