Kandi Technologies Rally Turns Sour

Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show.

Kandi Technologies Group Inc KNDI, a Chinese electric vehicle maker, was trading lower by $0.08 at $8.60 in Monday's session. A report that the company has received a joint venture sales contract for $89 million only provided a temporary boost to the downtrodden issue.

The initial reaction in pre-market trading was a spike to $9.42. However, it quickly faded from that elevated level and could not manage a print in the $9 handle, peaking just after the open at $8.90.

In fact, it retreated and easily surpassed it former low for its recent decline ($8.44), falling to $8.28 before rebounding back to the closer. The current low coincides with its low from December 27, 2013 at $8.20. If the decline continues through the intra-day low, there may additional support at its December 26, 2013 low at $8.04.

Today's price action is taking place on heavier than average volume. So far, it has traded 631,000 shares compared with its 20-day average of 788,000 with four hour remaining in the session.

Editor's note: At time of publication, shares were trading at $8.51, down $0.17 (1.9 percent).