Stratos International (STLW)

Company. Stratos International, formerly known as Stratos Lightwave, "develops, manufactures and sells optical subsystems and components for high data rate networking, data storage, and telecommunications applications." (company website)

Buy. I first bought Stratos last October after it had broken the $6 level on exceptionally high volume. As it turns out, I could have gotten STLW for the same price nearly a month later. Another case of premature buying.

I bought another small lot of STLW just last Friday, reallocating funds from another stock that wasn't doing so well. I was encouraged by the fact that STLW had worked its way back up to the $7.50 level on increasing volume and the ADX line (trend strength) was climbing steadily. Volume was rising day by day. It looked like it was poised to break out above the $7.50 level where it had stuck last at the end of November.

As luck would have it, moments after I bought, the price of STLW began to drift lower, ending the day down. Profit taking, I told myself. Yes, the volume was pretty respectable, but the price wasn't down that much.

Sell. This morning, STLW opened still lower and stayed there most of the day, with very few shares changing hands on an otherwise brisk day of trading on the Nasdaq. This unnerved me a bit. Did I miss something in the chart? When I placed my sell order at 2:30pm ET, only 1½ hours before the close of trading, fewer than 10,000 shares of STLW had traded.

In a déjà vu all over again experience, immediately after my order executed, having sat in the queue for over an hour, the price immediately jumped up 15¢.

I have no idea what will happen to STLW tomorrow. This is earnings season and the market is jittery, especially after the jobs report last Friday showing that the US economy had added just 1000 jobs in December, calling into question the sustainability of the economic recovery. Better safe than sorry.