First Solar as usual has found it's way back to the $125 area. In 2010 it seems like $120 - $130 is the reset point for FSLR no matter if the stock is rallying or falling. The base point is right around $124.
And this is where we stand as of August 21, 2010. First Solar closed at just over $125 a share, and the price looks as though it is ready to roll back up to $130 - $133. It may not close at that level, but I predict it will at least reach that level on an intra-day basis.
Looking at FSLR over the last year, there are multiple times where the stock hovers in the $120's and then either breaks down to the $104 - $112 area or it runs from the $120's up to $133 as a minimum intra-day trade. Either way provides us with an opportunity.
Buying here will give one of two predictable scenarios...
One, we will see the stock fall (rather abruptly) to around $108 (maybe not so low, maybe $110) and then form a base there. From that low we can buy a second block of stock. The stock will most likely return to the $120's. From there we can dispose of the original purchase at around cost, and take the profit from the second trade.
Two, we will see the stock rise in the next few days to within the $133 price target. We can quickly take our intra-day trading profit in this case.
Often, I have sold too early in this case. As just happened in the last 30 trading days, I sold at $135 even though FSLR continued to surge right ahead into the $140's. But I would rather be safe than sorry, and not risk the more predictable profit between the $125 to $133 price move. Pigs get fat, hogs get slaughtered don't forget.
So to me, FSLR is a buy either way on Monday morning. The obvious exception is if the market is set to open substantially lower, we can wait for a little bit. Watch the decline and get in when it appears there is some strength forming around the pricing. Even if you get in too soon (the bottom is still probably further down) you will establish your position in case a quick rally forms.
Let's peel another $8 out of FSLR this week (or in the coming weeks, let's make even more).
