Stratasys Ltd. provides additive manufacturing (AM) solutions for the creation of parts used in the processes of designing and manufacturing products; and for the direct manufacture of end parts. Its AM systems utilize its patented fused deposition modeling and inkjet-based PolyJet technologies to enable the production of prototypes, tools used for production and manufactured goods directly from three-dimensional (3D) CAD files or other 3D content. The company offers entry-level desktop 3D printers for idea and design development, a range of systems for rapid prototyping, and production systems for direct digital manufacturing under the Dimension, Objet, Fortus, Polyjet, SolidScape, and MakerBot brands. The company also operates Thingiverse, an online community for sharing downloadable, digital 3D designs; and GrabCAD Community for mechanical engineers and designers.
Take a look at the 1-year chart of Stratasys (Nasdaq: SSYS) below with my added notations:
SSYS started a steady decline back in September that lasted until February. During that time the stock formed a very nice trendline of resistance, which was finally broken earlier in April. After breaking that level, SSYS made its back way to the $60 level that had not only been a prior support (blue), but it had also been a prior resistance (green) back in March. Now that the stock has broken above $60 too, higher prices should follow.
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The Tale of the Tape: SSYS just broke back above $60. A long trade could be made at that level with a stop placed under it. However, a short trade could be considered on a break back below $60.
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
Follow me on Twitter: @cmtstockcoach