Earlier this week, I was preparing for my participation in a new episode of The Pitch. Unfortunately, that show got canceled as our host, Dave Keller, got sick with a cold.
One of the stocks I was going to pitch is PLUG. I ran into this company while working my way down from the sector RRG to the Technology groups RRG, where $DWCREE is showing up way up inside the leading quadrant at very high JdK RS-Momentum and RS-Ratio levels while still moving at an RRG-Heading around 90 with a long tail.
That type of rotation sparks my interest. ;)
This Renewable Energy Equipment Index is a bit of an odd one inside the tech sector. Due to the diversity, the classifications are not always clear. Some systems have some names in Technology and Semiconductors, but also have stocks showing up in the Industrials sector in different groups. Nevertheless, it is clear that this group is on the move.
The danger with this sort of move is whether it is too late to join, as a lot of the move has already taken place.
A quick look inside the group (against XLK) reveals that there are definitely a few tickers worth a closer look. One of them is PLUG.
Click the ticker to see the company description and you will understand the title of this article. ;)
PLUG has just moved into the leading quadrant from improving at a long tail, which suggests that there is enough power behind the move. RS-Momentum is still rising, but only gradually, though it seems to be able to maintain these levels.
The accompanying price chart shows a very clear break from a 6-month base after the stock dropped from the area around $70 back to $22.50.
Based on the price chart, there is very little resistance until $60-70, the topping area at the start of the year. In combination with a new solid support level of around $35, that makes for a good risk/reward ratio.
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