cacb what is the support level should I be concerned and consider selling? $16 purchase price

alanj answered 4 months ago …

This is a financial holding company. The general markets are over bought and they have now begun to trend lower and may possibly test the March lows. The financial sector has also been trending in the same direction as the general markets. This sector is going lower and I would be surprised if this stock doesn't do the same. We have had 5 up days in a row, I would sell today.

In the future use a trailing stop of 8 to 10 %. Some people place a fixed stop (same percentage) beneath the new high closing price at the end of the trading day. If the closing price is not a new high close the stop is not changed. Either way will work. If you had used a stop loss you would have gotten out early a saved many dollars.

Penny stocks and stocks that have become extremely over bought can be volatile. In which case the percentage can be increase to as high as 25%.

Do not buy stocks when they are over bought and trade with the medium to long term trend. Looking at a chart it looks like you may have bought on 9/19/2008 when this stock was over bought. On this date this stock also has a huge spike in price. In most cases spikes generally correct and come right back down. Buy when a stock is over sold or close to over sold and has begun to trend up. When a stock is trending up using a lower trend line buy on the dip. If a stock is trending down using an upper trend line you can if you're game enough short sell or buy put options on the peak.