Solar Waterfall

With CSIQ plunging today, along with TAN (ETF for the solar sector as a group). First Solar is back on my radar short radar for a potential secondary breakdown.

We looked at FSLR previously as an educational example of a "gap-fill," rather obvious on the daily chart, below. You can see price came down and filled that wide open space off the left of the chart, from late-February. 

Since then, the stock has churned sideways, as we expected it to be a bit of a rugby scrum after the gap-fill had completed. 

Now, however, with persistent sector weakness, the stock may be ripe to break lower yet below $49. Note how FSLR is "leaning down" against the gap-fill area, failing to muster much of a bounce. This type of price action could easily mean that buyers are losing their grip on any minor bounces, a bearish sign indeed. 

Solar has always been a hot money sector, where momentum cuts both ways in a pronounce manner. Just as the sun seems to be flaring on the way up, the waterfall can be rather treacherous on the way down.