Nordson Corporation is a manufacturer of equipment used for precision material dispensing, testing and inspection, surface preparation and curing. Its technology-based systems can be found in production facilities globally. It serves diverse markets, including the appliance, automotive, bookbinding, container, converting, electronics, food and beverage, furniture, life sciences and medical, light emitting diodes (LED), metal finishing, nonwoven, packaging, semiconductor and solar energy industries. Its products are marketed through a network of direct operations in more than 30 countries. The company operates in three segments: Adhesive Dispensing Systems, Advanced Technology Systems and Industrial Coating Systems.
To analyze Nordson’s stock for potential trading opportunities, please take a look at the 1-year chart of NDSN (Nordson Corporation) below with my added notations:
I latched on to NDSN because of the one simple level at $45. Not only can you see the $45 support (green) from earlier in the year, but the $45 resistance (red) has been very obvious over the last 2 months. So, the $45 price is key to this stock. If you are bearish, you might short NDSN at the $45 mark, but if you are bullish you would want to see the stock break through the $45 resistance.
The Tale of the Tape: NDSN presents a couple of very simple trading opportunities based on its key level of $45. A short position could be entered at the $45 resistance with a stop above that level, or a long play could be made on a break above $45 if that should happen.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT