NEW YORK ( TheStreet) -- The major solar earnings reports will begin this Thursday when solar-sector bellwether First Solar ( FSLR) reports. First Solar may be the bellwether, but reaction to its earnings doesn't always set the stage for the rest of the sector. Recent quarters have seen First Solar beat expectations and still flop in terms of market reaction -- some analysts contend it's been a result of First Solar being overly conservative in its outlook. First Solar hasn't been conservative recently, though. The solar bellwether announced 380 megawatts of orders beyond its expected shipments in 2011, and announced plans to build two new plants in the U.S. and Vietnam as the solar industry continues its growth into 2012. The First Solar sentiment headed into earnings season was backed by just about every signal, too. The euro rebound alone has made First Solar bear positions very vulnerable. The continuing demand and the stabilization of pricing in the market has also supported solar shares, which after an extended rally, can be said to reflect expectations for another season of solid earnings, likely plenty of "beats and raises" among the solar companies reporting. Volatile sectors like solar are also ripe for profit-taking. The euro may be at $1.40 now, but it caused the entire solar sector to crash just a few months ago. Fears of an event beyond the control of investors betting on short-term solar fundamentals is ever-present. In the last week or so, the fears materialized in the form of the trade and currency war with China. The U.S. Trade Representative said he would be elevating a petition made by the United Steelworkers Union to cite China for unfair trade support of its green energy companies. Many solar investors have used words we can't print to refer to claims that the sector sold off based on China concerns. There are good arguments to be made that the unfair trade support claims are unfounded when it comes to Chinese solar companies specifically, and what's more, would take so long to work their way through international courts that it's a non-starter as an investment issue. Nevertheless, the fact that solar bulls on the Street were out last week with reports downplaying the fears stoked by China are some kind of proof it must be in the minds of investors, in the least. Many Chinese solar stocks have sold off, too. In reality, though, the Chinese solar stocks didn't need the negative political news flow to merit a selloff. In a sector like solar, after a period of healthy gains, a pullback involving profit-taking investors is part of typical trading action.