Solar Flare: JA Solar Is Red Hot

(JA Solar article updated for closing price and trading volume spike)

ZHABEI, China (TheStreet) -- JA Solar(JASO), for the second consecutive day traded at a level that's extreme even for the solar sector.

By the end of Tuesday, just under 40 million JA Solar shares had been traded, close to seven times its normal daily volume. JA Solar hit more than 22 million shares -- almost quadruple its daily volume.

On Monday, even before after-market close news was released of a shipment-guidance positive revision and a share repurchase by JA Solar management, JA Solar stock was up more than 15% on the day, and some 17 million shares had been traded, versus an average of 6.8 million.

On Tuesday, the JA Solar flare was hovering at 10% all day, before closing with a gain of 8.7%.

These trading volumes and a two-day rise of 26% are noticeable, even in a momentum sector like solar, where outsized trading spikes are not unexpected, and sometimes border on unjustified. Akeena Solar(AKNS) recently shot up 56% in one day on news that Lowe's(LOW) would stock Akeena Solar's solar panels for the home market.

On one recent day, First Solar(FSLR), flared on news from business partner Phoenix Solar, even though the specific Phoenix news provided little reason for such a bullish call on First Solar.

So is the JA Solar rapid rise justified or another example of the solar sector version of Alan Greenspan's irrational exuberance?

The solution to JA Solar's huge run-up depends on which market detective you are talking to.

As for yesterday's rapid rise, before the after-market release of shipment guidance and a share repurchase by JA Solar management, there are some cynics who argue that someone somewhere had information ahead of the rest of the market.