First Solar Drops 3.8% As Technical Indicators Signal Rally Exhaustion

First Solar (FSLR) declined 3.82% to close at 210.96 on August 19, 2025, amid trading volume of 4.57 million shares. The session saw a high of 219.65 and a low of 208.51, with the pullback occurring after two consecutive days of double-digit percentage gains.
Candlestick Theory
The August 19 bearish candle closed near its low after rejecting the 220 resistance zone, forming a potential exhaustion pattern following the August 15-18 rally (11.05% and 9.69% gains). Key resistance is established at the August 18 high of 221.50, while immediate support resides at 208.50 (today’s low) and 199.95 (August 15 close). The long wick on August 18’s bullish candle suggests profit-taking pressure near 221.50, now a critical overhead resistance level.
Moving Average Theory
First Solar trades decisively above all major moving averages, with the 50-day (∼183), 100-day (∼172), and 200-day (∼165) MAs in ascending order—a bullish configuration. The price remains 15% above the 50-day MA, confirming a strong intermediate uptrend. The Golden Cross (50-day above 200-day) formed in early August remains intact, though the gap between price and the 50-day MA suggests potential near-term consolidation.
MACD & KDJ Indicators
The MACD histogram shows narrowing bullish momentum, with the signal line converging toward the MACD line following the recent surge. This may foreshadow a potential bearish crossover. KDJ readings (K: ∼85, D: ∼80, J: ∼95) indicate overbought territory, with the %K line hooking downward—a warning of short-term exhaustion. Bearish divergence appears as the August 19 price high (219.65) exceeded the prior peak while KDJ values failed to confirm the new high.
Bollinger Bands
Volatility expanded sharply during the August 15-18 breakout, with price briefly piercing the upper band (∼216) before reverting to within bands. The 20-day average (∼195) provides dynamic support. Bandwidth contraction in early August preceded the explosive 27% rally, while current bandwidth remains elevated—suggesting continued volatility. The closing price near the middle band (∼205) signals neutral momentum.
Volume-Price Relationship
The August 15 surge (11.05%) occurred on 10.9 million shares—the highest volume in three months—validating the bullish breakout. Follow-through volume on August 18 (9.5 million shares) confirmed the uptrend. The August 19 decline materialized on 46% lower volume, suggesting the pullback lacks conviction. Volume divergence during the retracement supports the bullish trend’s structural integrity.
Relative Strength Index (RSI)
The 14-day RSI (∼68) retreated from overbought territory (75 on August 18) but remains above neutral. While not yet oversold, the cooling from 75 levels may relieve short-term pressure. Historically, RSI sustained readings above 60 since July signaled persistent bullish momentum, though the current dip below 70 may indicate consolidation. Traders should note the RSI’s tendency to hover in 40-80 ranges during strong trends rather than extremes.
Fibonacci Retracement
Applying Fibonacci to the swing low (August 14 low of 176.47) and swing high (August 18 high of 221.50) shows critical support at the 38.2% level (207.70), which held during today’s pullback. The 23.6% retracement (215.30) now serves as resistance. Confluence exists at the 50% level (199.00) with the August 15 close and 200-day MA—making it a high-probability reversal zone if tested. The rally’s initial leg (176.47 to 221.50) suggests extended upside targets near 240 if resistance breaks.
Confluence and Divergence Observations
Confluence supports bullish continuation: volume validated the breakout, Fibonacci 38.2% held on initial test, and the moving average stack remains constructive. Bearish divergences emerge in KDJ and MACD momentum oscillators, warning of short-term exhaustion. Volume divergence during the pullback tempers bearish implications. The 215.30-221.50 resistance zone must be overcome to invalidate near-term bearish signals, while holding 207.70 maintains upside advantage.