Don't Ignore This Chart!

Solar ETF Fails at Resistance Yet Again

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The Solar Energy ETF (TAN) got a nice bounce along with the stock market from late June to early August, but this bounce has now reversed and it looks like the bigger downtrend is resuming. The chart shows the highs from late May and early June marking resistance in the 22.25 area. This area also coincides with the 50-62% retracement zone, which is a typical retracement amount for a counter-trend rally (correction). Resistance has clearly held as the ETF gapped down on Wednesday and it looks like the long-term downtrend is resuming. Note that TAN hit a 52-week low in late June and the SCTR has been below 10 for over six months. 

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--Arthur Hill CMT

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Arthur Hill
About the author: , CMT, is a Senior Technical Analyst at StockCharts.com. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London. Learn More
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