ENPH Shows Early Uptrend Strength
Shares of Enphase Energy, Inc. (ENPH), a solar technology company, have been showing signs of strength recently, with early signs of a developing uptrend becoming more evident. Following earnings on February 3, ENPH gapped up and triggered a bullish reversal above the lower swing high of $41.28 from September, then establishing a high of $52.93 before moving into a bearish correction. Just prior to that breakout, the 200-day moving average was reclaimed for the first time since September 2024, further indicating a possible trend change.
Trend Reversal Signals Emerge
The bearish correction that followed the $52.93 high eventually established a higher swing low at $29.90, fueling in a sharp advance to a new recent high of $73.74 near the end of May. That advance broke out above the downtrend line and found resistance near the 38.2% Fibonacci retracement of an internal downtrend at $70.03, while also confirming prior support as resistance from the November 2023 swing low of $73.49. That $70.03 to $73.49 price zone matched the first upside target zone for the stock. The subsequent pullback is healthy for the developing trend.
Pullback Tests Key Support Zone
The subsequent bearish correction that followed may be getting close to completing the first pullback after a key breakout above the downtrend line. The line was tested successfully as support once during the pullback two weeks ago, as a swing low was established at $48.46, which was very near the trendline. A slightly new corrective low was then generated last week with a low of $47.67. That was close to an exact touch of the trendline, further confirming it as a support zone, after it had marked dynamic resistance prior to the May advance.
Next Target Points Higher
While it is not yet clear whether the corrective low has been reached, the convergence of the 61.8% Fibonacci retracement of the prior uptrend at $46.65 and the 50-day moving average near $46.68 adds to the evidence for a strong support zone. If a sustained bullish reversal follows support, once it is firmly established, ENPH will be poised to recover the recent high and head towards the next upside target zone, approximately $97.37 to $99.91. This potential recovery toward that higher target zone mirrors the earlier breakout from $41.28 that set the current uptrend in motion, reinforcing the view that ENPH is building a stronger, more sustainable trend.
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