Google Penalty Question.

Over the last few weeks ive come across a penalty which i have never seen before and cannot work out whats happening to our site. (link in sig)

We moved from an old domain to a new domain with a 301 redirect about 3 months ago, we topped the new domain up with a few links and when the 301 redirect took effect we retained all our rankings for our local based keywords with the new domain name.

However several weeks ago, we noticed we had gone from No1 for a target keyword to not been found in the first 20 pages. Other keywords had gone from number 1,2,3 to the second page. But then a week later all the rankings returned and we thought nothing more of it.

However we are now stuck in a predicable cycle, every 4-5 days we get the same penalty, to exactly the same lower positions, then 4-5 days later they return to their No1 spots, then 4-5 days later we get penalised to the exact same lower positions again.

Can anyone shed any light on this and what can be done to stop the drop in rankings and stabilise them.

Does it have something to do with the 301 redirect from the old site?

Any help would be appreciated.

Tom