FERN, good question, I have those in my cuda and love them btw.
I tightened mine up till I was happy with the compression and the rubber was not to sqaushed out as such.
NOTE I strongly suggest popping an O ring onto the shaft under the bottom washer on the top of the shock, press it down onto the top of the shock tube, drive the car as normal adn then re check the location of the O ring, it will show you how much compression/travel the shock is doing as you DO NOT want to bottom out the shock. My Cuda is lowered at the front so I changed out the QA1 mopar shocks to the slightly shorter QA1 Chev shcok as I was pretty much just short of bottom out the mopar set.