Canadian Solar (CSIQ) Dip Trip
Canadian Solar (CSIQ) sold off from 52 to 3 and bottomed out last March. Its been moving higher since that time in a strong recovery that got even stronger, starting in November. The move topped out at 33.68 on January 6th and gave way to a steady pullback that accelerated to the downside on Thursday. The stock dropped within 30-cents of its 50-day EMA last Friday and closed near its low.
The selloff has crossed the 50% retracement of the 5-wave rally between 19 and 33. This suggests more downside before a decent bounce gets started. The 62% retracement at 24.71 should be watched closely because the selloff could easily undercut the 50-day EMA intraday, tag that level and close out with a bull hammer that might offer a good dip trade entry. If taking a position, keep stops tight and consider that reward is limited to the 38% retracement over 28.
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