MCP Long Position Update

MCP's last update was Friday after it had taken out all of the stop levels we were looking for, the update shows them all.

After MCP had taken out the last stop area expected (<$7.40) I added to the position that was intended from the start to be a phased in position and near or at a core long position (longer term long position).

Right now even with the phased in entry, MCP is in the green and looks good to me, it looks like it put in the head fake move under $4.70 and this is what we typically see about 80% of the time in all reversals just before the reversal starts and in every timeframe.

Here are today's charts characterized by a tight triangle, very similar to a bull pennant.

 A is where Goldman Sachs came out with a "sell Rec'd" so my guess is they were picking up shares on the cheap since MCP dropped below an obvious support level and volume ticked up hitting stops. B was a level I expected to be hit at $4.90 and C was the intraday yearly low which I figured would be hit and the one I was most paying attention to to see if it looked like accumulation (a head fake/shakeout) or if there was confirmation, it shows accumulation so I decided to add the rest of the position in MCP.

Note ATR has also picked up on this 30 min chart since moving back above that former support level.

In the reversal process I'm looking for something similar to an Igloo with a Chimney", the reversal process is the rounding as few reversals are a "V" like event and the "Chimney" severs as the head fake move or shakeout or in other cases a false breakout.

This is the shakeout level or head fake under $4.70 in yellow, the pattern that has formed since looks like a bullish bull pennant, I'd watch for a possible shakeout on the bottom side of the triangle before an upside move got going, but thus far MCP has done what we expected it to do days ago.

This is the hourly chart and the two main accumulation areas, one was what would have been support of a large ascending triangle and when that triangle broke lower and formed a large rectangle, we see a sharper leading positive divegrence as shares are easier to pick up with all the stops and at a much cheaper level, this is where we got in after our last trade of +38 and +58% after a lot of patience.

 The 30 min chart is hitting a new leading positive high today as it comes out of the entire rounding process and the move below $4.70 (head fake).

Closer on a 10 min chart, the positive divegrence I was looking for at that shakeout is clear, volume ticked up which is something else we are looking for and part of the reason for a head fake move.

The 5 min chart confirms

And note the Rate of Change in 3C after the GS sell rec'd at the red arrow, As I said back then, GS is more than likely a buyer of MCP and the ROC in 3C seems to make that pretty clear.

I think MCP is still in great position, a stop can be placed a but under the recent lows, I wouldn't put it right at them or any obvious place as it's just bad habit. Intraday a move below today's triangle with accumulation would make for a nice entry, but that's even a little myopic.