InvestorPlace - Stock Market News, Stock Advice & Trading Tips
First Solar Inc (NASDAQ:FSLR) shares have been rocking recently, and Monday’s 2.8% jump in FSLR stock provides just the excuse to take a renewed look.
Click to Enlarge Source: OptionsAnalytix
They certainly didn’t disappoint. On Friday, the stock scored a bullish engulfing candle that completely enveloped Thursday’s down day. Then on Monday, we saw epic follow-through in the form of the aforementioned 2.8% surge.
Since the stock bottomed in April, we’ve seen the Relative Strength Index (RSI) indicator confirm the bulls’ control by remaining above 50. That makes me all the more comfortable betting on trend continuation here.
The Trade on FSLR Stock
Unlike the rest of the market which saw a substantial spike in implied volatility last week, demand for First Solar options has been tepid at best. Such complacency has driven the stock’s implied volatility rank into the tank at 13.3%, which makes long option plays all the more attractive.
To capitalize, buy the Oct $47.50/$52.50 bull call spread for $2.20. The max loss is $2.20, and the max gain is $2.80. To realize the full reward, FSLR needs to trade above $52.50 by expiration.
As of this writing, Tyler Craig held no positions on any of the aforementioned securities. Want to learn how to master the art of option selling for high-probability cash flow? Check out Tyler’s recently released video series through Tackle Trading on how to systematically sell iron condors for monthly income.
More From InvestorPlace
The post First Solar, Inc. (FSLR) Stock Is Heating Up! appeared first on InvestorPlace.