Monday, November 19, 2012

MCP starting to Rock

I was asked to take a look at MCP because this is one that I never officially exited, I wanted to give it some time and see how it developed.

This I think is a neat set of charts because you are almost seeing this process occur in real time.

The idea of 3C is divergences that jump off the chart and are obvious are the ones where our probabilities are highest. They usually start on the fastest timeframe and migrate out to the longer timeframes where we can gauge just how serious the potential move may be. Then the process starts over and when the longer term charts are positive and our short term charts go positive (as far as I can figure this second half is the market makers/specialists who filled a larger institutional order and know the stock is going to move, start to adjust their own inventory as they trade their own accounts too, they aren't there as a public service, they are there to make money. So when we see the MM's starting to take acting, especially on a head fake move that they often create, then we know something is going on.

I assume I was asked to look at MCP because it hasn't made a move today, until just a bit ago.

 Here are a series of charts that show positive divergences, a 15 min

 10 min

Then the 5 min was positive, 3 min, etc.

 I backed this up to before MCP made a move higher at 2:02 today on a 1 min chart so you can see the divergence here taking shape, and then an hour later...

There's the same chart with MCP up 5+%. It has some decent longer term divergences so I'm not closing the position, but will let it develop some more. I didn't close it because of what I saw on the longer charts so why close it now when it's starting to make good on those divergences?

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