• I ignored my own advice and bought Ostin Technology (OST), leading to a 94% loss when the stock crashed.
• My stop-loss order failed due to low volume and cascading stops, highlighting the risks in thinly traded stocks.
• I neglected fundamental analysis — declining revenue, negative income, and poor cash flow should have warned me off the trade.
• Always confirm technical signals with strong fundamentals. This costly mistake reinforces the importance of disciplined investing.

My Big Mistake with Ostin Technology

On June 12, I published an article on Ostin Technology titled: “This Undiscovered Stock Is Up 150% in 2025.” 

Although I said it was not a “Buy” recommendation, I waited a couple of days and bought it anyway because I just couldn’t resist its technical signals. Here is what happened:

• June 12: Wrote about OST and emphasized it was not a “Buy” recommendation.
• June 18: I bought it anyway at $7.335, buying more shares than I care to admit.
• June 18: Placed a Sell Stop at $6.10.
• June 26: At approximately 1:30 p.m. Eastern the stock tanked before settling down to close at $0.55, a loss of about 94%.

As I mentioned above, I did have a Stop Loss in, but because of the low volume and all the other Stop Loses triggering, my Stop Loss was executed at $1.08. Way below my $6.10 Stop Loss.

Learn from my mistake, but first look at this UGLY chart:

OST Price vs. Daily Moving Averages:

Note the big hit in volume on April 15 that started the climb and the big hit in volume on June 26 that ended it.

Because I am writing to a large audience, I try to make sure that the stocks I screen are at least in the Russell 3000 Index (IWV) and only traded on major exchanges, instead of trading over the counter or on the “pink sheets.” I figured if a company has met a major exchange’s listing requirements, it would be hard for a “pump and dump” or other such crash to happen in its stock. I was wrong. 

Ironically, I sent a Webinar proposal to John Rowland CMT, Barchart’s Senior Market Strategist, the morning of the crash. If I had followed my own advice in that proposal, I would never have bought OST stock. Hopefully John will get approval to present that Webinar to you soon.

What Went Wrong With OST 

Here is where I went wrong. Ostin had all the right technical signs, making it a great stock to consider. However, I didn't look at the fundamental factors that would have confirmed that the increasing prices were not warranted.

The stock had:

• Declining revenue.
• Increasingly negative income.
• Declining operating cash flow.
• Increasing prices without increasing volume.

I forgot that the fundamentals are the causes of price movement, and you should always confirm that the fundamentals support the technicals.

It was a costly lesson for me and hopefully I won't make that bone-headed mistake in the future.

Caveat Emptor!

Today’s Chart of the Day was written by Jim Van Meerten. Read previous editions of the daily newsletter here.

Additional disclosure: The Barchart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.