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Shares of DayStar Technologies, Inc. (NASDAQ: DSTI) were down almost 7% on the day. I'm here to warn you of one thing: this is not the time to be calling the bottom in this stock.

Momentum stocks, by nature, quickly become falling knives when share price strength weakens. DayStar Technology, a solar panel stock that traded up with its peer group, is no different. Although I don't know much about the particular economics of the company, I'm well-aware of how 'pumped' stocks soon fade into oblivion.

As you can see from the chart below, DayStar was recently unable to hold the crucial $7 per share resistance level. Additionally, the stock has soon retraced its recent gains each time it has become overbought on the RSI indicator (red circles on the chart).

As I said before, the stock is down today. Although this might appear to be a 'rest' from recent strength, I believe the stock is prime for a roll over. Be careful and protect your profits.

Don't be shocked when DayStar falls into the night originally appeared on BloggingStocks on Fri, 04 Jan 2008 20:14:00 EST. Please see our terms for use of feeds.

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