The last 31 trading days has been brutal, with a 43% sell off...

The last 31 trading days has been brutal, with a 43% sell off from $3.05 to $1.74 today, and currently no signs of slowing down. There's been relentless selling into the bid and little to no respect for support levels. Unfortunately this sell-off is all organic, so there's no hope of a short squeeze coming to the rescue.

This has really changed the tone of the chart, the tone of the discourse and I think left many holders (including myself) shell-shocked. After such a long consolidation we were all expecting a powerful breakout, and it happened - just not the direction we were hoping for - so in that sense the magnitude and intensity of the move is not a surprise. But that doesn't make it any easier to deal with.

The question I have been asking myself what do I do from here. Was RAC ridiculously over-valued before? Has anything obviously happened in the last 31 days that would realistically cut the value of RAC in half? Is RAC a leaky ship and is going to release substantial bad news imminently? Is BG really the smartest guy in the room? Was RAC just one massive orchestrated pump and dump and is heading back to 10 cents per share?

I believe the answer to all of these questions is no. I may of course be wrong about any of these in which case I'll have learnt a hard lesson that charts really can predict fundamentals, and will have had at least some of my faith in humanity shaken. But I'll have to live with that.

So I think this sell-off is probably being technically driven due to the failure to break out higher, perhaps supported/enhanced by ongoing BG selling and possibly tax loss selling also. As a result this will stop somewhere where buyers start seeing value enough to offset the supply coming in. We just don't know where that will be.

Today's announcement shows again that RAC management are playing the long game. We understand now in Biotech that no news/slow news/late news is generally good news, so I think we have a lot to look forward to. Eventually the technicals will catch up with the fundamentals. Though we may have to live with slow and steady, we can even hope for a pleasant surprise that will blow our socks off. Until then, the market is going to make us earn every cent we will (eventually) make from RAC.