Solar and Oil, Part Deux

So...I wrote about a break in the correlation between oil and solar stocks the day before oil takes a major tumble that crushes solar stocks at the same time. The one-day massive move on September 2 did not re-establish a correlation, but it was jarring nonetheless. All sorts of stops and targets triggered, and I am still trying to sort out the meaning of the action and make plans for the next month or so. At times like these, I find writing to be a great organizing and clarifying tool. I will focus here on explaining my short-term positioning in various solar stocks since I did not do so the last time. Note again that I am long-term bullish on solar, and I have made no changes in those positions. What I describe here are short-term positions.

Suntech Power (STP)
STP has ripped upward since reporting stellar earnings two weeks ago. Shares short soared back to 52-week highs going into earnings and no doubt a lot of the lift in the stock has come from short-covering. STP has since stumbled twice, the last hiccup happening right at resistance from the 200-day moving average [DMA] and congestion formed around the April and May highs. These highs were formed as resistance formed from the congestion areas formed in January and February (not fully shown in the chart below). In other words, the odds were high that STP would fail once again to conquer these levels. I was a bit early in establishing the short, but my cover was triggered on Tuesday's sell-off. Short-squeeze not withstanding, I still consider STP a short from a technical perspective until it can overcome this tough resistance. I am leaving in play calls that I snagged as a small hedge.