SolarEdge Technologies Shines, But Can It Continue?

The shares have been very strong the past six months and longer.

The Lightning Round segment of Mad Money is where callers can get to ask Jim Cramer about stocks they are interested in. Thursday night one caller asked about SolarEdge Technologies (SEDG) . "All of the solar stocks are going nuts but people love solar energy."

Let's check out the charts of SolarEdge Technologies.

In the daily Japanese candlestick chart of SEDG, below, we can see that prices have been very strong the past six months and longer. Prices are above the rising 50-day moving and they are what I would consider "extended" or "overbought" versus the rising 200-day moving average line, which intersects down around $150.

The On-Balance-Volume (OBV) line has improved the past six months but its rise is small when compared to the price action. The 12-day price momentum study shows that upside momentum has been slowing this month. This is not a bearish divergence but it does put us on alert.

In the weekly candlestick chart of SEDG, below, we can see that the shares have soared from their base down around $40. Prices are above the rising 40-week moving average line.

The weekly OBV line has risen the past two years but does not match the price rise measure for measure. The 12-week price momentum study does not show any slowing in the rally and no bearish divergence.

In this daily Point and Figure chart of SEDG, below, we can see that prices met and exceeded their price target of $229.  

 

 

In this weekly Point and Figure chart of SEDG, below, we can see the dramatic rise over the past few years. A much higher price target is being projected but prices are extended too much already. 

 

 

Bottom-line strategy: SEDG is still pointed up but a close below $280 will weaken the chart. Protect long positions.