First Solar (FSLR.US) shares dropped nearly 2.0% on Monday after J.P. Morgan downgraded the solar panel manufacturer to “neutral” from “overweight.” J.P. Morgan’s analysts expect that recent sharp gains which occurred after the announcement of the Inflation Reduction Act, which provided additional incentives for alternative energy, will slow down in the near future.
“…we view First Solar as the biggest near/medium-term beneficiary from the Inflation Reduction Acts’ domestic manufacturing tax credits,” analyst Mark Strouse wrote in a research note. “However, with the stock up [more than] 120% over the past four months, we believe the ‘easy money’ has now been made.”
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First Solar (FSLR.US) stock rose over 15.0% only in November 2022, however buyers struggle to break above key resistance at $175.00, where highs from February 2011 are located. As long as price sits below this level, a larger downward correction may occur. Nearest major support to watch is located at $125.30. On the other hand, if buyers manage to push the price above the aforementioned resistance, then the road towards highs from May 2009 at $207.00 will be left open. Source: xStation5