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Pro Traders Play Book - Major Action!

Did These Stocks Actually End The Week Positive?

As you know the major stock market indexes continue to struggle. Almost every sector has come under heavy selling pressure since late July 2011. Most traders and investors are now wondering where strength can be found in the market, and if there is any sector worthy of an investment. Well, while long term investing may be out of favor these days there are always trading opportunities available to those who can understand the charts. This report, we shall examine three stocks that held up well last week and the opportunities they may present. These stocks showed some short term relative strength and will most likely trade higher if the major stock markets can stage a short term bounce or rally. Conversely, if the major stock indexes continue to decline these stocks will likely fall prey to the downside momentum. The stocks that showed strength despite the overall stock markets weakness last week were semiconductor equipment makers. Let's examine and reveal exactly what you need to know about these stocks going into the following week.

Lam Research Corp (NASDAQ:LRCX) is a leading semiconductor equipment maker company. Last week, LRCX ended higher by just $1.22 to close at $37.18 a share on Friday. Please understand, LRCX has been in a down trend since topping out in early March 2011 at $59.10 a share. Last week, LRCX continued to hold above the important $35.00 support level which is now a minor level, therefore, should the $35.00 area get tested again the stock would be susceptible to fail and breakdown. Should the major stock indexes rally higher next week traders can look for LRCX to trade higher. This stock will face near term resistance around the $38.50, and $41.00 levels. Please remember, the current stock market is really nothing more than a short term trading environment. Should LRCX breakdown and close below the $35.00 level on the daily chart the stock will have short term support around the $34.00, and $31.25 levels. Make careful note of these levels on your charts and trade them accordingly.

Novellus Systems Inc (NASDAQ:NVLS) is another leading semiconductor equipment maker that actually finished the week higher. The stock closed higher by just 0.95 cents to $28.12 a share for the week. Nonetheless, it was still a gain. In fact, both LRCX, and NVLS closed higher on Friday when the Dow Jones Industrial Average and the NASDAQ Composite ended the session lower by more than 2.00 percent. This tells us that there is some short term relative strength in the industry group. Should the major stock market indexes trade higher next week NVLS is a candidate to see higher prices. The stock will have short term daily chart resistance around the $30.00, and $31.50 levels. Should the stock break and close below its recent low pivot of $26.14 the next support levels will be around the $24.25, and $22.50 levels.

KLA Tencor Corp (NASDAQ:KLAC) is a leading semiconductor equipment and material manufacturer. This stock also followed LRCX, and NVLS, by closing higher on the trading week. This stock closed higher by just 0.64 cents to $35.46 a share. While the stock did not soar higher it was positive in a weak and fragile stock market. Should this stock trade higher from the current level there should be near term resistance around the $38.00, and $39.50 levels. Should KLAC sell off and close below the recent pivot low of $33.20 the stock will have near term support around the $29.75 level.

 Nicholas Santiago