Equal Opportunity Energy

Although we have no predisposed biases inside Market Chess Subscription Services, if there is one specific group of stocks we have been consistently cautious or bearish on it has certainly been the solars.

Despite wild proclamations by solar bulls of the imminence of this alternative energy as the clear-cut wave of the future, equity markets have been rather skeptical of that view and it has been reflected in the price action for at least the last several quarters. 

At a certain point, though, we reach a make-or-break moment, not unlike coal saw recently, where some firms will either perish or survive and potentially thrive for having withstood the onslaught. 

Although a new solar bull run is barely visible from a technical perspective, a name like First Solar is taking a step in the right direction with a move over $40 per share. We had highlighted this setup for Members within the last week, as FSLR was beginning to form a conventional inverse head and shoulders potential bottoming pattern after a prior, steep downtrend. 

On the daily timeframe for FSLR, below, you can see how important $40 has been dating back to late-2014 as prior support. Simply put, bulls could not afford to have $40 convert into newfound resistance. 

The rough target of the measured move from this pattern points to over $47, with earnings on November 14th. 

There are a few other intriguing solar-related setups I will discuss for Members. But I suspect we need to see crude oil stay firm in order for them to have a chance.