You have probably heard the phrase ‘don’t catch a falling knife’.
For a long time now, I have been cautioning HC about stocks with falling knives chart formation as I feature them rather prominently and even track their declines.
Today, those stocks appear to make a synchronised decline – they fall rather heavily despite a slightly higher market and they reflect a continuous fall.
The message is why get involved in a declining stock when there are so many other good ones out there with an upward price trajectory. A stock that is suffering from a continuous declining share price is going through the motion to adjust its share price which had previously been excessively lifted through irrational exuberance premised on undelivered promises and incorrectly perceived potential.
As I expressed many times, A dog of a stock will show you more fleas as time progresses
Buying into a falling knife stock on perceived bargain is IMO the fastest way to lose money, as cheap gets cheaper.
