Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: JA Solar
So What: China's 0.25% increase in interest rates has sparked rumors China will allow its currency to rise versus the U.S. dollar. This would make Chinese solar panels more expensive abroad and thus lower demand.
Now What: JA Solar has fallen along with the rest of the solar sector today following a few strong weeks. The solar market has risen recently on increasing confidence that 2011 will see strong demand, so I see today's sell-off as a correction considering the volatility in solar. For the long-term investor this doesn't change my bullish view on solar, so look at the pullback as a long-term buying opportunity. In the short-term there are enough unknowns heading into the G20 Summit to make me think we may have a few more down days before we see some stability.
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