Stocks Dropped By 99%!!!

Hello guys! Ambac Financial Group Inc. or ABK in the New York Stock Exchange filed for chapter 11 bankruptcy after failing to raise additional capital for the company. By the way, they are primarily a holding company whose subsidiaries are involved in financial guaranteeing. They made it through the 2007-2009 financial crisis but couldn't hold any longer but to file bankruptcy.

The company failed to reach an agreement on restructuring its debt with creditors but will further negotiate with other institutions to get out from bankruptcy. As of June 30, the company had an outstanding debt of $1.62 billion and probably even more at this time. They gained 3.75% to $0.52 during yesterday's trading session then dropped 59.62% to $0.21 at the market's after hours trading following the bankruptcy report. Chart-wise, they never rebounded after the 2007 financial market meltdown. From an all-time high of $96.10 back in May 18, 2007, their stocks broke down from the 7-year support and terribly duck-dove to an all-time low at the current value 0f $0.21 (the current premarket value). That's a 99.78% drop in 3.5 years!!! By the way, the stocks of Accenture also dropped by 99% but in just a day (kindly check this post), however it was a computer glitch. Anyway, ABK now broke down from a 2-year descending triangle based on my technical analysis and we'll see a gap down during the market's opening. I can't spot any significant technical support right now but there are psychological levels to look into. The immediate psychological support could be the $0.20 marker. If the stocks further drop below that, the next psychological support could be $0.15 then $0.10. On the upside, the significant resistance could be $0.30. Some may find this a good opportunity to buy and for some, really not. Well, I'd consider this a big gamble unless Ambac makes it out of bankruptcy and would not get delisted in the stock exchange. That is a big risk involved, although, the upside's pretty huge as well.  This is definitely not one of my stock watch. Let's see where this goes later. Happy trading!