Plug Power (PLUG) - Get Report logged a steep loss on Tuesday to the tune of 8.8%. This earnings-inspired selloff is quite damaging, but shares are still above a very solid support zone. If further damage is limited, a low-risk entry opportunity could develop of patient bulls.
Back on July 21, Plug Power mounted a powerful breakout move following its Walmart(WMT) - Get Report announcement. The stock surged more than 15% on the news, leaving behind a solid support area in the process. Plug Power has remained above this level since, but a test now appears to be on the way. If the stock can remain above this area while the post-earnings dust settles, an important low may be in place.
In the near term, investors should view Plug Power as a low-risk buy near current levels. The stock's July 21 breakout gap rests at $2.15. Just below is the 50-day moving average. A hold here in the face of a rather negative earnings report response would be a strong signal. On the downside, a close back below $2.00 would violate the July low, sending a clear warning sign of a potentially deep selloff.
Plug closed Tuesday trading down 8.82% to $2.17.
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