MCP Follow Up

It has been a long time since I've been willing to add to the MCP partial long position, but after yesterday's stop-run/ head fake under $2.50, I felt pretty strongly that we were in the right place, Trade Idea: MCP Filling out Long Equity & New Calls Position and the charts MCP Charts.

As of this morning, MCP has been up over 5% thus far.

Charts...

 The post earnings drop and range, we had needed a head fake move before MCP could really break out of the year plus base, I showed the proportionality of the base and probable head fake even if it was earnings driven , the same thing happened with RIMM, but the accumulation was inside information on a huge management shake-up.

As is often the case, the more defined a range and support/resistance levels, the more likely a stop run will occur as traders keep adding stops and orders at these support/resistance areas and Wall St. can see all of these orders and know where they need to take price to create the most favorable environment (meaning the largest amount of supply at the best prices. Yesterday we speculated that was below $2.50 and finally later in the afternoon, $2.50 was taken out.

Here's the initial break below the May post earnings range and volume surge as stops and orders are hit and the quick move down through $2.50, with another volume surge as $2.50 is a natural psychological level (the same reason a store will price an item at $2.49 rather than $2.50).
 

This is the 60 min chart divegrence through the May post earnings range and one of the biggest reasons I maintained the partial long position, waiting for the right time to fill out the rest which was yesterday.

On a 3 min chart, the break under $2.50 can be seen as being sharply accumulated, the divergence is sharp as there was a lot of supply (volume) that had to be taken up in a short time.

When you have a 15 min chart leading positive in a single day, you know there's some heavy underlying flow (larger amounts of accumulation).

Thus far, MCP is showing perfect confirmation with the move higher.

I'll be setting new price alerts on the upside for >$2.70, $3.02 and $3.20