I almost gave back the gains from my MGM trade. I normally do not trade through earnings, and knowing MGM is scheduled to report its earnings on 2/14/2011, I was prepare to close out the trade before it reports. The mistake I made was I did not realize MGM is schedule to report before the market open on 2/14/2011. When I found out this weekend that MGM will be reporting before the open, the only thing I can do is to close out my position in pre-market. The price that I closed out the position is simply catching a bid to get out before MGM reports. Fortunately, I caught a bid near the 15.70’s and got out with an average price of 15.71. Although this trade did not hit the 16.90 price target, but it did realized a gain of 1.07R.
Here is the 5 minutes chart of MGM showing some pre-market price actions:
and the daily price chart for the day this trade ended:
2/7/2011:
This is my recent swing long trade based on a bounce off support for a casino stock, MGM.
I entered a long position on 2/7/2011 when the price move above the previous session high of 15.04 after an intraday low was made near the 50 SMA. The target level for this trade is 16.90. The day after this trade was entered, MGM gapped up on the open after an upgrade from Bank of America/ML. I took a partial profit when it moved above +1R and set the stop near my entry level for a risk free trade for the remaining size. The initial stop loss for this trade was set at 14.40, a price level slightly below the 50 SMA.
The MGM weekly price chart shows there is a long term resistance at 16.90 and it has retreated from this resistance level three times within the last 2+ years.
A swing long trade was entered on 2/7/2011 based on the bounce off the 50 SMA and the supporting trend line from the daily price chart.
The 15 minutes intraday chart pointing out where the trade was entered after the price break above the 15.04 level.
I will provide an update after I have closed out the remaining size.
