MCP Follow Up

Here are several recent MCP posts/Updates so you can get up to speed if interested. I normally don't cover stocks this cheap, but we have seen something in MCP's 3C charts for some time, something that said "Something is going on here" and as I always say, "With 3C we can see what money is doing, but by the time we find out why, the chance to make money has passed".

In this case it was a 10-year deal with Siemens which sort of puts all of the Seeking Alpha articles about the company's imminent demise out to the pasture if Siemens is willing to sign a 10-year contract for rare earth metals. I suspect this may be what was in the pipeline causing those persistent 3C accumulation signals.

In any case, recent posts:

April 15th, MCP "Patience Pays?"

April 22nd, MCP Update

April 24th, MCP Position Update

MCP closed up +17.86% just a couple days after our Wednesday post showing accumulation in to the consolidation/pullback off the near +100% mid April 2-day jump.

Today's update from this morning is the last one, April 24th above. As I said, "As soon as we can get this in to a Trend Channel, I'll post the stops".

As of the close, this is what the charts look like for MCP...

 Today's Daily chart with a close that has a little too long of an upper wick on its candlestick for my liking, especially on that volume, it suggests some churning, although I think we may be ok in this case for the moment.

As I think I made clear, I have little doubt MCP breaks out from the large "W" stage 1 base and moves to stage 2 Mark-up. I'm just not convinced it's on this leg without a consolidation together a head of steam,  which would make for a beautiful long or add-to entry.

 The 3 min 3C chart shows some profit taking which isn't surprising with double digit gains and going in to the weekend, I think we can let that slide.

The 5 min chart was clean and accurate enough to call the 4/16 highs as seeing distribution, today it's in line so I don't have immediate concerns about MCP's upside as the 5 min chart is in perfect confirmation (green arrow area) today after a significant positive divergence on the consolidation pullback.

 This 30 min MCP chart shows significant "Gas in the tank", however it isn't a particularly large divergence in terms of time, but it makes up for that in intensity on such a strong timeframe. (The longer the timeframe, the more significant the underlying money flow).

 It's this 60 min chart that has me a bit concerned that MCP stalls at base resistance, that's where it did last time in forming the top of the "W" to the left, although there was a very significant positive divergence/accumulation at the second low of the base which by the way saw a head fake move/stop tun under the yellow trendily, as usual, just before a trend reversal (to the upside). This is the same concept we are dealing with right now in the broad market. As I have said dozens of times this week alone and thousands otherwise, a head fake move is one of the best price-based indications we have for timing a reversal as they happen about 80% of the time in every asset and every timeframe as you can see above by the shorter 60 min timeframe and much smaller trend area to be reversed (lows). The more obvious the head fake trigger such as resistance/support, a triangle's apex, etc. and the more popular or watched the asset, as well as the bigger the trend to be reversed, the higher the probabilities of a head fake move which already stand at about 80% even for a small trend change in a little known stock like MCP at a small support area.

 It may be a little premature, but for a wider stop, I have set my Trend Channel at 60 mins. This is the first indicator I won an award for and it self-adjusts to each assets individual volatility and creates a channel around that. If volatility changes, the Channel changes with it , not quite like Bollinger Bands, but not at all like an envelope channel. I apply a certain standard deviation to the channel and if that is broken, then we know that something unusual has happened and a change of character like that will lead to a change in trend, thus we stop out with an objective stop system that doesn't require guessing as to when / where the move is over.

Currently the 60 min which I prefer to use on a close or at least the close of a 60 min bar is at $.89.

The channel will keep locking in gains, even if MCP were to consolidate laterally here, in fact the channel will often hold a healthy consolidation without stopping out.

For a tighter stop, the 30 min Trend Channel has held the last 2-days of gains and is at $.92. As the trend becomes more developed, we can apply a wider channel to allow for normal consolidations and capture as much of the trend before the choppy/volatile top which rarely gives better gains beyond a lucky guess, this is meant to capture the meat of the trend, not to stop out at the high, 3C is better suited to that and I use both in conjunction.

If you need an updated Trend Channel stop, email me. We will likely also be able to put it in to our X-Over Screen/system that will tell us where the most likely first pullback will be and whether it's healthy or not, we just need another day or so.

For now, until the 60-min chart has time to catch up, I would assume resistance at the base's trendily, but I'll stay on top of it, feel free to email me with questions/chart requests for MCP.