Sunpower, revisited

Solar in general and Sunpower in specific were probably were probably the best stock sector and individual stock modelings of the past 2 years or more.  In this post I called solar a "screaming buy", something I have not done before or since.  But nothing goes straight up.  Sunpower, one of the 2 big name US solar companies got 5 wave up that let it run from $4 to $28.  But those 5 waves have exhausted the buyers and besides, the overarching markets are ripe for a big big pull back. 

In the chart of Sunpower below I see 5 waves down from $28 to $21and then an A-B-C recovery to $24.  While there is no confirmation yet, if I was trading this stock I would definitely run to the sidelines to see if that declining double top breaks out or breaks down.  As you can see, I am modeling it for a breakdown and a potentially sizable one at that.  I don't see the C wave only going to the 38.2 from here because it would make the C wave the weaker wave and that is never supposed to happen under EW rules.  Time will tell of course but the rise was so fast that there have to be plenty of weak hands in it right here.  I'm giving this an 85% probability of occurring as long as it stays lower than $24 at this point.  If it goes above $24 but stays below $28 then I give it a 70% chance of eventually breaking down into a C wave as shown.

For now, however, the heavily declining double top is not a good omen.  The chart needs to shake that off quickly or else.