Tuesday, July 26, 2011

MCP explodes off of inverse head and shoulders pattern

It pays to trust trust charts and read technical patterns.

Yesterday I posted an alert to enter MCP long at or near the confirmed daily head and shoulders neckline. I entered this trade myself just prior to posting at 59.35. Today, the stock exploded to the upside and is now trading nearly 5 dollars above my entry price, up 7%.

The internet and media are buzzing with buyout rumours and general hype surrounding this stock, but none of it matters. Just read the charts, know the patterns and do what they tell you.

If you entered this trade, sell half at 66 and then set a breakeven stop for the rest of the position. The final target is 72-78, depending on how quickly it trades up.

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