Is the sun still shining on Trina Solar (TSL)?
Discussed in this article: Trina Solar Ltd. ( $TSL )
We’re looking at Trina Solar ( NYSE:TSL ) here. If you have been following me at all, for any time at all, you probably know why we’re looking at this; volatility squeeze, the stock had been trading in a really tight range actually for a while, we can even go back here, it’s just been in consolidation for quite a while.
Here’s some of the things that I’m looking at: first of all, all the while that this has been trading sideways what’s been happening with the 200-day moving average, and that is, it’s intuitively obvious, each value is the average price over the last 200-days. Well because the stocks up here, gradually the 200-day moving average has been coming up to where right now this is the average price, right down there over the last 200-days. The 50-day, kind of a different deal, the 50-day moving average price is basically where the stock has been consolidating. This is a really nice consolidation; it’s a REALLY nice consolidation. So now when we get this, this volatility squeeze, a breakout on heavier than average volume, this is a stock that you want to buy. Trina Solar ( NYSE:TSL ) looks really, really nice, I mean it looks great, I think this stock has further to go.
Also, I can’t tell you the number emails I got from people asking me if my Chart of the Day ( NYSE:RENN ), which was at the end to this day, followed by this move of course, they said, “Did you move that stock?” Look at the volume here, this thing traded over 16 almost 17 million shares, if only I could move this stock; this stock moved for other reasons, I just happened to see this pattern, and frankly to be perfectly honest, I may have even gotten this idea from somebody in our traders forum, I don’t remember, I look at hundreds and hundreds of charts a day, and take notes throughout the day, and by the way, so should you. But my point is, a guy like me doesn’t move a stock like this, not that many shares, so this is just a technical trade.
One thing I would say is this, the high here was what, 4.79, and the high yesterday was what, 4.79. Even though this stock fell 6.5 percent today, keep an eye on this stock; this trade is over, but you’ve got to keep an eye on this stock, because after this kind of move, absent some news that the company’s being acquired by Warren Buffett, this stock should have retraced more, it really didn’t. The fact that during the day, and it’s not like it gapped up to this level, the fact that during the day the stock actually reached up to test yesterday’s intraday highs, that’s a big deal, that’s a really bullish sign. So don’t take your eye off the ball here, this could move higher.
Now with that said, I think it’s got some rest to do, unless there’s some story out there, where people are trading on inside information, but you can see this stock is still overextended by any analysis, volume was not what it was the day before, so you can see this stock trailing back a little bit more. If you’re long after yesterday you need to go ahead and take those profits, but don’t take this off your screen.