Kulicke and Soffa Industries Inc. (NASDAQ: KLIC)

Kulicke and Soffa Industries, Inc. designs, manufactures, and sells capital equipment and tools to assemble semiconductor devices. It operates in two segments, Capital Equipment, and Aftermarket Products and Services (APS).

Take a look at the 1-year chart of Kulicke (NASDAQ: KLIC) below with my added notations:

1-year chart of Kulicke (NASDAQ: KLIC)

During the past four months, KLIC has formed an important level of resistance to watch at the $22 (red) mark. The stock tested that $22 mark again on Friday. A close above that $22 level should lead to higher prices.

The Tale of the Tape: KLIC has a key level of resistance at $22. A long trade could be entered on a break through that level. However, if you are bearish on the stock, a short trade could be made on any rallies up to $22.

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!

Good luck!
Christian Tharp, CMT