Corning (GLW)

Company. Corning manufactures optical fiber, cable and photonic products for the telecommunications industry; and high-performance displays and components for television and other communications-related industries.

Buy. I bought Corning about a month too soon. The stock had made a nice rise in price and peaked in mid-March before giving back some of the gains. After a decent interval I decided, for no apparent reason, that it was time for it to reverse and go back up again, so I bought. And for a time, it did rise again.

I can now see, however, that there were signs it would get worse before it got better, and in fact, it did. Although the Chaikin oscillator had turned upward, directional indicators (ADX, +DI, -DI) were anything but encouraging. GLW made another "correction" at the end of April before starting a steady climb upward.

Sell. I sold GLW in the context of an all-round ugly day in the market. I had begun to watch GLW carefully after it stalled out in early June and began moving sidewise. I was content to let it do so, since stocks often do this after a significant upward move. "Resting" so to speak. But the past two days, however, the directional indicators took a distinct ominous turn: the +DI line was pointing downward (indicating less "buying pressure") and the -DI line was pointing upward (indicating more "selling pressure"). Furthermore, the Chaikin oscillator was drifting downward. I decided to lock in some respectable profits while I still could.

Second time around. This was actually my second time to trade in GLW. The first time was in late 2000. I had awakened to the fact that GLW had made stratospheric gains in the euphoria of the internet expansion and the "new economy"; Corning was supplying all that fiber optic cable. I would get a piece of that action! What I failed to notice, however, was that the Nasdaq had peaked and was on the way down and that the air was escaping from the internet bubble. Six months later I bailed out of GLW after losing 65% of my investment. Ouch! Although large percentage-wise, it was still a relatively modest sum dollar-wise, inasmuch as the number of shares was very small.

The gain on this second go-round obliterates the earlier loss and still leaves a very tidy profit. I confess to feeling some measure of vindication.