Shares of First Solar (FSLR) experienced a significant surge on Wednesday, spearheading a broader uptick in clean energy stocks. This rally follows heightened investor enthusiasm generated by the previous night’s presidential debate featuring Kamala Harris and Donald Trump.
During the debate, Trump indicated that Harris would potentially “revert to solar” should she assume the presidency, expressing his support for solar energy. While Harris did not specifically address solar power during the debate, she is known for her advocacy of the Biden Administration’s Inflation Reduction Act. This legislation promotes clean energy through tax incentives for rooftop solar installations and other green initiatives.
The renewed optimism in solar stocks is particularly timely for First Solar, which has faced a period of stagnation over the last 18 months. Elevated interest rates have dampened demand by increasing the costs associated with financing and installing solar panels and other related energy products.
In technical terms, an analysis of First Solar’s stock chart reveals critical price levels worth noting. The stock recently emerged from a saucer pattern in late May, driven by robust trading volumes, but peaked in mid-June before retreating by approximately 36%. It has since found stability around the pattern’s neckline.
On Wednesday, First Solar’s stock saw a notable jump, reaching its highest trading volume since late June and closing above the significant 50-day moving average. This indicates strong buyer conviction, with the stock rising by 15% to close at $239.84.
Looking ahead, investors should monitor three key price levels. The initial focus should be on the $235 mark. Although the stock closed marginally above this level on Wednesday, sellers may still target this area, particularly around a trendline linking narrow consolidations from early July to late August.
A decisive move above $235 could propel the stock towards the $265 level, where resistance may be encountered due to similar trading levels observed in June. Continued buying pressure might push the stock toward its 2024 high near $300. This target aligns with a calculated projection from the saucer pattern’s low to neckline, suggesting an upside potential of $300 when adding the pattern’s span to the breakout point.
