|On November 3, 2008, I suggested shorting shares of TAN, a solar energy exchange traded fund (ETF). Shares peaked the next day at $13.84 and then began a long slide to reach a low of $5.40. This was in line with my price target of "well below $8." So is now the time to cover those shorts and maybe even go long?|
|FIGURE 1: TAN, DAILY. The blue oval shows the stock's new consolidation channel.|
|Graphic provided by: Wealth-lab.|
|TAN has broken out of the old downward sloping trend channel upon which I based my previous comments. It has now set up a small channel consolidation pattern, as can be seen on the daily chart (Figure 1). Along with the consolidation pattern, volume has dried up as well. It is not displayed on the chart, but daily and monthly stochastics are oversold, but weekly stochastics are overbought.|
|In conclusion, given the consolidating channel pattern and the lack of any other discernable evidence to point to a move in either direction, this appears a good time to close out any short positions and to be flat in TAN.|
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