Enphase Energy Stock Rockets Past Resistance ... Now What?

Enphase Energy Inc ENPH shares are trading higher Wednesday after the company reported better-than-expected third-quarter EPS and sales results, as well as issued fourth-quarter sales guidance above estimates.

Enphase Energy was up 24.66% at $216.22 Wednesday at market close.

Enphase Energy Daily Chart Analysis

• The stock saw a large gap up past pattern resistance in what technical traders call a pennant pattern.
• The price was getting condensed between narrowing highs and lows and finally saw a breakout above resistance. Consolidation, while the gains made from the gap are held, could signal more upward movement in the future.
• The stock trades above both the 50-day moving average (green) and the 200-day moving average (blue), indicating the stock is likely facing a period of bullish sentiment.
• Each of these moving averages may hold as an area of support in the future.
• The Relative Strength Index (RSI) made a large move higher Wednesday and now sits at 76. This push higher sent the RSI into the overbought range and signals the buying pressure heavily outweighs the selling pressure in the stock today.

See Related: Why Enphase Energy Shares Are Rising

What’s Next For Enphase Energy?

Bullish traders saw a breakout past the pattern resistance. Bullish traders are looking for the stock to either continue moving higher or to have a period of consolidation where it holds its gains.

Bearish traders are looking to see the stock fade back lower into the pennant pattern it traded in. If the stock can fall back into the pennant pattern, bears would want to see the stock fall below the pattern support for a possible strong bearish move.

Photo by Zbynek Burival on Unsplash