Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Ambac Financial (NYSE: ABK) shares fell 13% in trading Monday, as uncertainty about the mortgage insurer's future creeps back into the market.

So What: Last week Ambac jumped on news that the company may be able to restore some insurance claims on big banks. As time goes on, investors are growing less certain about how much this could benefit the distressed Ambac.

Now What: Shares' climb last week owed partly to a short squeeze. Now, as we Foolishly predicted, the stock is coming back down to earth. Once the stock stabilizes, it may provide a great buying opportunity for investors willing to bet that the big banks will be held financially responsible in some foreclosures. After topping out at $1.10 at the open, the stock has fallen to $0.92 per share, showing major momentum to the downside. I never like to catch a falling knife, but when the stock levels out, investors looking to go long on Ambac will have a better price to jump back in.

Interested in more info on Ambac Financial? Add it to your watchlist here by clicking here.

Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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