The market reacted accordingly in the after-hours session yesterday, sending shares of Texas Instruments up over a buck to close way above $20 per share, good for a better than 5% gain.

I can see the justification behind the reaction. The news does place Texas Instruments in a new light. It provides some context to the ongoing market rally. Consider the price action in the Dow on Monday. The fact that we closed in the green (albeit just barely) after being deep in the red is telling.

But then we have the other consideration: when will the buying, at least in the short term, cease?

Texas Instruments, like many other stocks, has been very strong the past few months. Institutions have obviously been anticipating this news. Now that the news is out, I feel that the trade may be done. I would not chase Texas Instruments today if it does end up rocketing higher (I am writing this ahead of the opening bell).

Once it does give back some of the gains, then I think the company would be worth a look. The tape has been too strong to ignore. However, I'd suggest to strongly consider using a tight stop. While I'm not going to argue with the tape, let me say, quite honestly, that I think the tape can be a liar when it wants to be. When I look at how far the bulls have come, I get more and more cautious. So, even though Texas Instruments does appear to have trading potential, it doesn't hurt to be careful.

Disclosure: I don't own any company mentioned; positions can change without notice.