First Solar Is Approaching A Key Technical Level

Joel Elconin is the co-host of Benzinga's PreMarket Prep, a daily trading idea radio show.

First Solar, Inc. FSLR shares are trading higher by $2.45 at $44.77 in Monday's session.

The catalyst for the rally may be a DOE report from Friday that was mentioned during the President's State of the Union address. It was revealed that for every three weeks in 2014, as much solar power was installed than in all of 2008.

With the cost of solar projects decreasing, demand is increasing and may lead to explosive growth.

Since mid-December, First Solar has been attempting to build a solid base in which to rally from around the $40.00 level. On January 20, it put a bottom in at $39.18, and put a string of five higher lows as the issue climbed back into the $40.00 handle, closing at $43.72 on January 27.

After a few days of consolidation, it is poised to close at its highest level since December 19, when it ended the session at $45.03.

The company will not report Q4 earnings until March 3. In Q3, it beat Wall Street estimates by $0.23, but the Street may have focused on its revenue miss. Shares have drifted lower from $50.00 over the last three months.