Evergreen Solar (ESLR)

Company

"Evergreen Solar is a developer and manufacturer of photovoltaic (PV) modules - the engines of solar electric systems - used in remote power and emerging grid-connected markets.

"The PV modules produced by Evergreen Solar are distinctive in their appearance because they incorporate proprietary crystalline silicon technology known as String Ribbon. This technology, explained further on, enables an innovative approach to manufacturing dependable and cost-effective PV modules." (company website)

Buy

1-Mar-05. ESLR came to my attention yesterday when it made a nice jump on heavier than normal volume. It took off again today, and I jumped on the bandwagon. The sudden interest in ESLR is supposedly driven by Gov Arnold Schwarzenegger's proposal to increase the use of solar energy in California.

This could be a two-day wonder. Or not. It has doubled in price since December.

13-Apr-05. What might have been a "two-day wonder" has turned out to have surprisingly strong legs. Last week it traded at a new high of $8.23, up almost 25% from my purchase price. Although profit-taking pulled it back down and made ESLR oversold, relative strength (RSI) has ticked up again as has buying pressure (+DI). Accordingly, this morning I made the bold move of adding to my position, bringing the average share price up to $6.81.

What I think is going on here is that as the reality of the looming energy crunch becomes more obvious to all but those in deepest denial, alternatives to oil become more attractive investments.

Sell

23-May-2005. I gave up. It is now abundantly clear that the high of $8.23 reached in early April was the start of a downtrend that is going to continue. As long as the price of ESLR hung above the pre-breakout price I nursed along hope that the trend would still reverse, especially it formed the bullish "stick sandwich" last week (pink oval). But this morning removed all doubt. ESLR broke down and neared the 200-day moving average.

The signs have been there for quite a while: declining price momentum (PPO), declining trend strength (ADX), negative money flow (CMF), and declining relative strength (RSI). Where I really started on the slippery slope was when I added to my position — twice.