Analyzing the Bullish State of Solar Stocks through Chart Patterns

Solar Stocks Analysis

Chart patterns and the global acceptance of solar energy indicate a bullish situation for solar stocks, according to analysts.

Charts are important aspects of trading education and help in making crucial investment and stock trading decisions. Analysts live on charts and a good deal of insight, and that’s what you should do too. In the solar industry, chart patterns seem to indicate a good deal of positivity. Solar stocks are cast in a bullish light, according to analyst Casey Murphy.

Investing in Alternate Energy

When it comes to energy stocks, you have renewable and unconventional energy sources such as solar energy, wind power, tidal power and biofuels, equally clean energy sources such as lithium batteries and hydrogen fuel cells, controversial but powerful energy sources such as nuclear power, and the conventional oil, natural gas, and coal energy. As of now, alternate energy sources have not been able to totally shatter our reliance on conventional non-renewable sources such as oil and natural gas. There’s always the expectation that this would happen and that’s where the investment opportunity comes in for clean fuels. It’s not without its risks, and there could be a significant amount of volatility. But there is a potential for significant growth and rewards in clean energy stocks.

While an investor in alternative energy must be prepared for a good deal of volatility, it is important to choose the alternate energy that is receiving widespread acceptance and has the potential to satisfy the world’s future energy requirements the most, according to analyst Kristina Zucchi. Only that will help you get returns on your investment.

The Solar Industry Appears Bullish

One thing seems certain – the immense and relatively immediate growth potential of solar stocks thanks to the widespread global adoption of solar energy.

Nations such as China have made announcements regarding shifting to clean energy. This has made the perspective bullish for the entire clean energy industry, be it solar energy or lithium power. There are clear uptrends visible on the charts involving solar assets. They could be a vital indication to place your buy order, according to Murphy. Murphy points out that the risk/reward ratio is seen by analysts to be quite lucrative now. They are keen to point out that the perspective for the solar industry is bullish and this could be quite the right time to buy.

A Major Solar ETF

Analyst Murphy turns our attention to the Guggenheim Solar ETF ($TAN).

image of trading chart for solar stocks etf $TAN

ETFs such as these provide the exposure to actual growth in the solar industry. $TAN consists of companies from all over the world spanning various kinds of industries related to the solar industry, and these include solar equipment manufacturers, raw material suppliers to solar equipment manufacturers, solar installation businesses, solar infrastructure financing companies, and companies selling solar-derived electricity.

The chart reveals that the ETF is displaying a clearly defined uptrend within which it is trading.The price has indeed sunk below the 50-day moving average support. However, the trendline in the vicinity has managed to raise the price. If a sell-off occurs, this could happen again. For active traders, they’ll want to open positions that are close to the trendline and use the stop-loss orders below the 200-day moving average, at $19.05, or the swing low condition to protect those positions, based on the capability of risk tolerance.

A Top Holding in the ETF

Murphy then discusses one of the $TAN ETF’s top holdings, Canadian Solar ($CSIQ).

image of trading chart for solar stocks $CSIQ

Canadian Solar is really gaining attention because of it being closer to the major support levels. The chart above tells you that the price did move higher than the important long term moving averages recently. This gives it a bullish trend since the price is likely to shift higher. Traders will likely use the horizontal trendline to determine when to place buy orders. Murphy believes that most of the stock traders will, in all probability, give their positions some space to run so that they don’t get withdrawn from their positions earlier than they should. Stops could likely be set below $14.18 for protecting against a sell-off.

Bullish Prospects for Israeli Solar Inverter Systems Manufacturer

Murphy opines that the Israeli designer and manufacturer of optimized inverter systems to be used in solar installations, SolarEdge Technologies ($SEDG), is overlooked by investors.

image of trading chart for solar stocks $SEDG

As the chart reveals, this stock is also trading with an uptrend that is clearly defined and has little chance of reversing. The bulls are in charge here.

With charts, it is easier to get some objective information to make decisions appealing to the head rather than the heart. Advanced trading software, like ZeroPro or ZeroWeb, also come with features such as these for effective investing and trading online.

TradeZero on FacebookTradeZero on Twitter
TradeZero is an online broker dealer that offers commission free trading of the US equity markets, US equity and index options trading, along with a 14,000+ symbol short list of the US markets. Its clients receive up to 6 to 1 intraday leverage and the ability to trade the US markets without any pattern day trading rules. TradeZero clients have access to a variety of cutting edge trading platforms which include real-time streaming market data.

TradeZero

TradeZero is an online broker dealer that offers commission free trading of the US equity markets, US equity and index options trading, along with a 14,000+ symbol short list of the US markets. Its clients receive up to 6 to 1 intraday leverage and the ability to trade the US markets without any pattern day trading rules. TradeZero clients have access to a variety of cutting edge trading platforms which include real-time streaming market data.

    Leave a Reply

    Your email address will not be published. Required fields are marked *

    Translate »