Cenveo (CVO)

Company

CVO 1-year chart CVO 1-year chart

"Cenveo, headquartered in Stamford, Connecticut, is a leader in the management and distribution of print and related product offerings. The Company provides its customers with low-cost solutions within its core businesses of commercial printing and packaging, envelope, form, and label manufacturing, and publisher services; offering one-stop solutions from design through fulfillment. With over 10,000 employees worldwide, Cenveo delivers everyday for its customers through a network of production, fulfillment, content management, and distribution facilities across the globe." (company website)

CVO 6-month chart
CVO 6-month chart

Buy

18-Jun-08. Since CVO bottomed at $9.21 it has been trending solidly upward, and is now pulling back from the most recent peak. There was a big sell-off at the market open this morning, and I chose this opportunity to pick up a second lot at a very nice price.

  • Price momentum (PPO) — falling after latest peak, but still positive
  • Relative strength (RSI) — has fallen to mid-range (50)
  • Trend (ADX) — just at the threshhold (20), reflecting weakening after latest peak
  • Volume — has fallen off

Based on technical analysis, MarketEdge calls CVO a "strong buy" in a "weak upward trend."

Sell

gain Bottom line
-19%

1-Jul-08. This could not have gone more wrong! What I thought was just a normal dip back to the 1-month average — then back to the 50-day moving average — then back to the lower Bollinger band — turned out to be the proverbial slippery slope. Today I bailed before the close at a new 52-week low on the third consecutive day of higher-than-normal down volumes.

Looking back, it's obvious I should have paid more attention to the weakening indicators rather than explain them away as normal after a pullback. That is normal after a pullback, but I failed to confirm that the pullback was over, and it cost me dearly.