First Solar (Friday’s close US$93.62) declined from US$175.45 in early 2011 to US$11.54 in mid-2012 (not shown), had a recovery rally to US$74.84 in early 2014 (not shown) and then settled in a wide, multi-year horizontal trading range mostly between US$30 and US$80 (dashed lines). The recent rise above the top of this range (A) signaled a major breakout and the start of a new major up-trend.
Behaviour indicators including the rising trend-line (solid line) and the rising 40-week Moving Average (40wMA) confirm the bullish status. There is good support near ±US$78; only a sustained decline below US$66-$67 would be negative.
Point & Figure measurements provide targets of US$99 and US$109. The large trading range (dashed lines) supports significantly higher targets.
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Monica Rizk is the senior Technical Analyst and Ron Meisels is the president of Phases & Cycles Inc. (www.phases-cycles.com). And he tweets at @Ronsbriefs. They may hold shares in companies profiled.
Chart source: www.decisionplus.com
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