Align Technology (ALGN)

Company

"Align Technology, Inc. is a medical device company engaged in the design, manufacture and marketing of Invisalign®, the world's leading invisible orthodontic product." (company website)

Buy

20-Oct-05. Align has been bouncing along the $6 level for quite some time. It has now equaled the previous peak on several days of strong trading. Last Thursday was a "deliberation day" (black arrow), and the rises have come after that.

• Price momentum (PPO) — sharply accelerating
• Trend (ADX) — still a bit weak, but buying pressure (+DI) has picked up dramatically
• Money flow (CMF) — crossed over into positive territory
• Relative strength (RSI) — strengthening, and now stronger than any previous point in past three months
• Volume — average daily volume has fallen over three months, but has stabilized during past weeks

Sell

18-Nov-05. Well, it was a good idea at the time, but it sure turned sour. On the third day, ALGN set a new high, then fell to close below the previous day. I should just automatically sell when that happens — it rarely, if ever, gets better after that. The reversal is now clearly broken (sidebar). This morning ALGN traded low enough to give me a loss of $1 per share, and that's when I bit the bullet.