I am concerned about the price movement in FCEL today. After closing at 157.56 yesterday (139.75 – 158.25), it opened at 165.88, ran up to 188.69 and then settled to close at 171.97 (165.88 – 188.69). On the charts, today’s price action formed a SHOOTING STAR BEARISH.
SHOOTING STAR BEARISH: During an uptrend, the market gaps open, rallies to a new high, and then closes near its low. This action, following a gap up, can only be considered as bearish. Certainly, it would cause some concern to any bulls who have profits.
I am also concerned about the Jefferies & Company analyst (Paul Fremont) 12-month target price of $440. “FuelCell is developing a combination fuel cell-turbine power plant that Fremont believes could produce delivered power for 4 cents a kilowatt hour. Typically, electricity produced by a gas-fired plant costs 3.7 cents per kWh.”
I have to wonder where he got that target price. It seems rather arbitrary and excessive. It also reminds me of the analyst that set the outrageous target price on QCOM near it’s high. QCOM still hasn’t recovered.
I figure that the price gap between 158.25 and 165.88 will be filled before FCEL continues it’s strong run up. In after hours FCEL inched up to 172.50. The huge volume (3.5M shares) is a positive, but the stock did close near the low.
With the stock split coming up tomorrow, the STOOTING STAR BEARISH candlestick formation, the unfilled price gap and the HUGE volume, the next two days should be interesting.
B.K. |
