NEW YORK (TheStreet) -- The PHLX Semiconductor Index (637.48), known as the SOX, has a solid year-to-date gain of 19%. But the SOX multiyear intraday high was set at 659.54 on Sept. 19, while the Nasdaq (QQQ) set its multiyear intraday high at 4654 on Nov. 3. The SOX has had mixed results.
Even with this positive backdrop, investors should be raising cash by selling strength or establishing stop-loss strategies to lock in gains on these stocks. Here's how.
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Five components of the SOX have significantly outperformed year to date: Avago Tech (AVGO) is up 61%, Intel (INTC) is up 29%, Lam Research (LRCX) is up 45%, Micron Tech (MU) is up 52% and Skyworks Solutions (SWKS) is up 110%. Avago and Skyworks have been helped by the success of Apple's (AAPL) iPhone 6.
Avago Tech ($85.04) has been a beneficiary of demand for the iPhone 6, but the stock has been extremely volatile. The stock set an all-time intraday high at $90.88 on Sept. 19, then corrected 24% to as low as $68.75 on Oct. 10, which held the stock above its 200-day simple moving average at $68.32. Since Oct. 10, Avago stock rebounded by 28% to $87.93 at Friday's high.
Investors should book profits by employing a "good 'til canceled" limit order to sell strength to a key technical level at $90.00, or use a sell stop below another key technical level at $79.20.
Intel ($33.58) set a multiyear intraday high at $35.56 on Sept. 8, then corrected 17% to as low as $29.65 on Oct. 15, which was above its 200-day simple moving average at $29.03. Since Oct. 15, Intel stock rebounded by 20% to as high as $34.78 into Nov. 4.
Investors should book profits employing a "good 'til canceled" limit order to sell strength into the $34.78 to $35.56 range, or use a sell stop below a key technical level at $31.00.