GrafTech International (GTI)

Company

"GrafTech International Ltd. is one of the world's leading manufacturers of carbon and graphite products for industrial applications in a diverse array of industries: metal production, electronics, chemicals, aerospace and transportation, among others. Our products, which include carbon and graphite electrodes, carbon and graphite cathode blocks, advanced carbon and graphite materials, and flexible graphite, are manufactured on four continents and sold in over 70 countries around the world. Continuing a century-old tradition of global leadership, the employees of GrafTech are united in their dedication to common goals: continually improving productivity, maximizing profitability and delivering the highest levels of quality and value to our customers." (company website)

Buy

1-Dec-05. GrafTech reversed a steep downtrend in May, then corrected in September-October. The uptrend was restored in November (see sidebar). The 50-day moving average has crossed above the 200-day moving average.

• Price momentum (PPO) — sharply increasing over past month
• Trend (ADX) — strengthening steadily and gradually
• Money flow (CMF) — has gone from strongly negative to strongly positive
• Relative strength (RSI) — generally increasing
• Volume — price jumps have been on higher than normal volume

Sell

9-Mar-06. Not meant to be. I gave up on GTI today after they released earnings in line with Expectations; it was obviously not what The Market wanted to hear. I held on after GTI was slammed with the hope of a rebound from an over-reaction. But hopes were dashed by today's reaction to earnings.

There doesn't seem to be any way to protect against sudden convulsions caused by news. The reaction was so swift and severe that any reasonable limit order would not have executed.