KLIC MT bot 5400 @ $4.70, now holding 10,600 shares av. cost $4.75. I'm guessing that KLIC is in the process of forming a ST bottom. Previous bottoms often took 2-4 weeks to form, with the stock in a trading range ($1-0.50 wide) at the bottom, and abrupt moves ($2-4) on either side of the bottom formation.
Of course, there is also the possibility that the next abrupt move could be another plunge down. For instance, the stock spent all of July in a trading range of about $6.25-6.75, after coming down off the MT high of $7.95. Since I am still mostly cash, I can buy the next abrupt drop, and the one after that, too.
And, if I'm wrong about how far this stock will fall, then I can just wait. Anytime in the last 10 years, buying KLIC below $5 has been a good trade, if you have the patience to wait a few months, and the courage to continue holding no matter how low the stock temporarily goes. This stock is not going to "do a Lehman". It has $3.23/share in cash, it doesn't lend to its customers to prop up sales ("doing a General Motors"). |
