The market has not been kind to the solar space. Considering the success of the companies is loosely tied to coal, and commodities have not done well recently, it makes sense that weakness has come into that space.

But there are some signs that sellers are running out of energy here. While FSLR is making new marginal lows, the RSI is making new higher lows. This indicates that momentum is slowing down, and if the stock has enough time, sellers run out and the stock will rise in price until new sellers come in.

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Couple that with a decent amount of short interest (10%) and you’ve got a stock ripe for a pop.

  • Keep in mind that the stock is still in a downtrend, so you need to be very aggressive with your timeframes and targets.

A good first target is 47.50 is, and then 50 is a stretch target. New lower lows in the stock or RSI would invalidate this reversal pattern.