I've got hit by this Penguin update but I think somehow the traffic recovered. I deleted the blog posts that were out dated and removed those out-bound links which were somehow redirecting towards spammy sites. Other than that, I didn't do anything.
Google Penguin is a code name[SUP][/SUP] for a Google algorithm update that was first announced on April 24, 2012. The update is aimed at decreasing search engine rankings of websites that violate Google’s Webmaster Guidelines [SUP][/SUP] by using now declared black-hat SEO techniques, such as keyword stuffing,[SUP][/SUP] cloaking,[SUP][/SUP] participating in link schemes,[SUP][/SUP] deliberate creation of duplicate content,[SUP][/SUP] and others. [h=2][/h]