KLIC Classic Double Top

We traded KLIC from the zero number breakout at $7, up to the double top at $7.50. Why did we sale?

RSI went over bought, a new run at another high created the double top/lower high RSI, which is classic sale signal. Our trading rules dictate that we exit the shares. When do we buy again? Stock has bounced off a 38% retrace. While this pull back area can be a bottom, generally the time frame is not sufficent enough to warrant a favorable risk/reward entry. Stock is likely to move back to the 61% retrace level, of which we will re-examine at that time.

BYD Trade Example

First what sets this move up is the broader index. We run a scan that pulls out the worst performing indexes that are beging to see cash flow into them. Once we have that, we identify strong tradable canidates by there trend reversal stock patterns. Next we count specific day vibration based on historical trading time frames of 30,60,90,120,180,etc. Once we had the double bottom confirmed in BYD, we simply put our buy above the 50 day at $8.27, and sold the shares at the 200 day resistance point. One last point, the March option expire puts/call favored a run at the $10 strike. So this trade had all the stars aligned for us.