The move came after the company reported earnings. Plug Power reported better-than-expected revenue, allowing the stock to jump higher on the day.
While the stock was up nicely in the session, shares weren’t exactly off to the races in premarket trading. That's likely as the company's losses widened.
This stock has been all over the place, but most recently it’s been under pressure.
Plug Power rallied alongside NIO (NIO) - Get Report, Tesla (TSLA) - Get Report and other EV stocks. The ramp in GameStop (GME) - Get Report and AMC Entertainment (AMC) - Get Report didn’t hurt either.
But the relentless buying eventually caught up with speculators as Plug Power was obliterated.
Shares fell more than 75% from the peak in January to the low in May. As it tries to turn the corner now, let’s take a closer look at the stock.
Trading Plug Power
Ahead of earnings, Plug Power stock was giving mixed signals. It was below the 200-day moving average, while the 10-day and 21-day moving averages were acting as resistance.
On the flip side, the 50-day and 50-week moving averages were acting as support. Further, shares were doing a good job holding up over $28.50.
Remember, Plug Power has “meme-stock” potential, in that when bulls decide to ramp a stock higher, they could easily pick this one. Particularly with the stock rallying on earnings and sporting a short interest close to 10%.
With Tuesday’s rally, Plug Power is ripping through all of its major moving averages - including the 10-day, 21-day and 200-day - and threatening to clear the June high at $34.38.
That’s a big level. If it can clear that mark, there’s not much in the way to stop it from rallying to $40.
Now that’s not to say that it will rally to $40. Just that there’s not a lot in the stock’s path from a technical perspective should it clear the June high.
If shares gain momentum and start to push up toward $40, bulls will likely have their attention on the gap-fill near $42.
On the downside, look for previous resistance to act as support.
For instance, if Plug Power pushes through the June high but the rally fizzles out, look for the $34.50 area to act as support. Or if it can’t push through the June high, look for Plug Power to find the 200-day moving average as support.
Below that puts the 10-day and 21-day moving averages in play. Bulls will need to see these measures turn from resistance to support if they want the narrative to change.