Trade Idea: MCP Long

This is not a market correlated trade, this is a long term base that I believe will enter its own primary bull market regardless of the market. We've been watching and trading MCP for some time as it has been in a large stage 1 base, the last post that was important for the next set up was March 25th MCP Trade Idea

The gist of the post was...

"MCP daily triangle, there's a decent chance for a head fake/stop run, if that happened it would be even more attractive as a long...If I didn't have exposure and liked the idea, I'd probably enter a half position size and enter the other half if there's a head fake break below the triangle "

This is what MCP looked like the day of this post...

 This is the triangle and the 25th is the yellow arrow, the post on the 25th expected a head fake move BELOW the triangle as it sets up momentum for an upside reversal, it's just a matter of verifying accumulation/positive divergences at the suspected head fake move and waiting for the reversal process to form as reversals are almost always a process, not an event.

The next day we got exactly what we were looking for...This is how Wall St. uses Technical Analysis against traders every day.

 The 60 min chart shows the move below the triangle has a fairly mature reversal process, however even on a small pattern like this (almost) small double bottom at the reversal process, it is common for a head fake move here as well, that's the neat thing about these concepts and the market, they are all fractal and scalable to any timeframe. That means I'd set an alert for a move below the $4.60 area as it is a daily Hammer/support and stops are bound to be piled up right under that and the head fake move is seen about 80% of the time just before a reversal so we are looking at two head fakes, 1 already in place, the second much smaller, but an even better timing indication.

I'm setting alerts for a move under $4.60 and that's where I'd prefer entering MCP long position, although that's pretty myopic, I wouldn't have any problem if need be, entering right here and now.

 As you know the long term charts are in excellent shape and confirm a large stage 1 base, I zoomed in a bit just to show the positive divegrence even at the triangle and since the break below that we were looking for.

Intraday 1 min there's action in a flat trading range, this is where we see a lot of strong underlying trade, it looks like nothing is going on and in reality a lot is going on as orders are filled at stable prices (VWAP usually) and traders get complacent, this is another reason I say, "Price is deceptive", I'm always on heightened alert in a flat range or quiet market.

 Look at the 2 min chart during the head fake move, that's the kind of signal we want to see to confirm it is a head fake and not just a break down. This also allows us a better entry at lower risk, although emotionally it is a much harder trade to enter, but logically it is much less risk and much better positioning.

This is the 15 min chart and its leading positive at the head fake area so I'd say we have good confirmation that the head fake we were looking for 3/25 is indeed a head fake and can be used as an entry.

Like I said, under $4.60 would typically be what I'd expect next, but that is fairly myopic of me.