Yingli Green Energy Broke Support

Published on Friday, 30 July 2010 05:04 Written by TradersHuddle Staff

New York, July 30th (TradersHuddle.com) - Shares of Yingli Green Energy Holding Co. Ltd. (NYSE:YGE) closed the trading session at $11.19 below calculated support at $11.59 breaking the stock technically, raising concerns by investors, as the move might trigger more selling.

Yingli Green Energy Holding Co. Ltd. (NYSE:YGE) designs, manufactures and sells Photovoltaic (PV) modules in China and internationally. The Company also designs, assembles, sells and installs PV systems that are connected to an electricity transmission grid or those that operate on a stand-alone basis.

Yingli Green's stock was trading in a well defined range with support at $11.59 and resistance at $12.59; given that this range was broken traders will be closely monitoring the stock?s price action for clues of direction.

From a technical perspective it can be expected that previous support becomes resistance, as the new range gets defined, however, given that Yingli Green's stock is still near the broken support, traders will be focusing on $11.59 to see if the stock can bounce back and return to its previous range.

Traders wanting to establish a short position in Yingli Green Energy can do so if the stock breaks the intraday low, or if the stock bounces back and selling materializes again at previous support of $11.59. For traders wanting to establish a long position, wait for price action to take the stock back to calculated support, which will provide a best entry point to build the position.