I believe this will be a buying opportunity at these levels. The stock might go a little bit lower to the high 10s. This was a panic selloff based upon an earnings preview press release. The exact reason behind the selloff was because of some vague statements made on tight supply. CSUN had traded quite lethargicly before the press release which tells me that the news was at trading desks before the general public knew about it. Then when the news hit, the sell-off began. Think of it this way. All the major players are gone from the trading desks before the July 4th holiday. Then the press release comes in which seems negative. There is a risk manager standing over the traders in the trading room ordering them to sell off the shares in CSUN and without any major leadership at the desk they do so in kind. When the holiday is over and the leadership is back, CSUN will be bid up again. I saw a lot of buying actually in the last 30 minutes of trading. I do give one warning to those reading this thread. There is a chance it will go lower, but all the bad news is now priced into the stock. The earnings call in August probably wont take it down further and the street will expect tighter margins for the call. Im not sure why the company made this pre-release. I suspect that they didnt want to be like SOLF or JASO which did not warn before the earnings call. In any event, despite the JASO tight margins warning during their conference call, their stock has nearly doubled. SOLF went to 8 in change and now trades at over 11. I suspect this event will be a buying opportunity, but wait until CSUN bottoms and starts turning up which can happen very quickly. I see CSUN as a 22 dollar stock in the times to come. 3-6 months time.
CSUN is up nicely. I have taken my profits from the TRMP panic sell and have placed them into this panic sell, ride it up, dump and then find another panic selloff to jump in on.
Well, the pre-market was looking good...I have a golden rule and thats never to get in during the pre-market.... I got in at 10.8-10.9 range. I believe this will be a solid support. The Jeffries analyst came out and made some positive remarks stating that the company had the best R&D department in the business. The guy who runs the R&D used to work at STP. The only negative comment from JEF was that they have to get their poly supply together. I know why the stock tanked, but think about it this way...they made some vague statements about the supply situation and gave a few facts. The selloff was based on a vague statement followed by a few rudimentary facts. This wasnt a real conference call where management gets questioned by the analysts and we can dive more into the matter. The traders priced in the worst case scenario. So I feel comfortable in the 10s as I earlier stated it would go. So if the company got its poly supply together then the stock would shoot to the 20s...thats been the hidden problem that has been dogging the stock.
Here is the new chart and you can see that this might just be a good double bottom. There is something else you are not seeing though and thats the lower bollinger band right at 10.12. Thats right, it might just go lower. The key to watch tommorrow is if there is a selloff during the open and we see it spiral down further. It looks like they turned the sell volume off right at 10am. I say if it recovers then its going to take a good 5-10 days of consolidation at the 10.8-11 dollar level before moving higher. Of course, that is, if the guy running the sell volume the first 30 minutes of each day will start cutting that out...
JASO and FSLR are at technical correction points. They both had good runs and now its time for a little pullback. However, CSUN went on sale at a 20% discount. The analyst liked the stock, but they thought that something could be done about the supply. The company appears well aware of the problem and has signed deals with other suppliers and has an action plan. I say CSUN bases in the high 10s for about 3-5 days and then takes off. The take-off wont be overnight, but will form a nice cup until it gets to 14-15 area.
update: still holding FSLR and LDK up about 16 points on FSLR up about 9 with LDK holding and holding strong blackguard