Why Sunrun's Stock Looks Set To Sprint

Sunrun Inc’s RUN stock reversed course on May 19 when it announced a partnership with Ford Motor Company F to facilitate the installation of the new 80-amp Ford Charge Station Pro and home integration system for Ford’s new all-electric F-150 Lightning.

Sunrun’s stock had been in a deep downtrend for months prior to its Ford announcement, making lower highs and lower lows since reaching its Jan. 12 high of just over $100. The downtrend looks to have ended after Sunrun’s stock completed a triple bottom reversal pattern on May 11, May 13 and May 19 and started to run north.

The Sunrun Chart: Within its steep downtrend Sunrun created a descending trendline (pink) of resistance that, on Monday, it attempted to break above. Although Sunrun rejected from the trendline, the stock printed a bullish green hammer candlestick that indicates higher prices may be in the cards.

Under the downward sloping trendline, Sunrun has also formed a bullish inverted head-and-shoulder pattern (green). The inverted head-and-shoulder pattern has a neckline slightly lower than the descending trendline but the two lines merge on Monday through Wednesday, giving the stock extra resistance at the $46 level. Bullish volume could help Sunrun bust through both trendlines and make a bullish run.

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Sunrun has regained the eight-day and 21-day exponential moving average as support and on Monday the eight-day EMA crossed above the 21-day EMA, both of which are bullish indicators. Sunrun is trading about 23% below the 200-day simple moving average, which indicates overall sentiment in the stock is bearish. Sunrun’s stock has some work to do to regain that level as support and complete a sentiment shift.

Bulls want to see bullish volume come in and break Sunrun’s stock up above the descending trendline and the inverted head-and-shoulder neckline for Sunrun to trade back up to a support and resistance level near $48. If Sunrun can regain $48.13 as support, the stock can trade back up in the $53 range.

Bears want to see Sunrun reject the trendline and neckline and continue trading below them until the stock loses support at the $42 level. If Sunrun’s stock was unable to hold that level as support, it could fall toward $36.

RUN Price Action: Shares of Sunrun were trading down 5.3% to $43.71 at publication time.