(click on the chart to enlarge)
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| Figure 1 |
Looking at the recent price action from the daily price chart of MGM (figure 2), MGM stock price has been trending within a rising trend line along with a rising 200 SMA, 50 SMA, and 20 EMA. It made an intraday high of 15.95 on 5/14/13 before it pulls back to find support from the rising trend line and the resistance-turn-support level near 13.50.
On 7/18/13, MGM finally broke above the 5/14/13 high and closed above $16.00 at $16.18. In the last trading session, it dipped down to 15.98 intraday nearly the 5/14/13 intraday high of 15.95. If MGM can hold above the 15.00 level, it has the potential to break out of this trading range and move to the next possible level of resistance near the 20.
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| Figure 2 |
Since the beginning of July, 2013, there has been four possible entry points to initiate a long position (figure 3). Entry #1 was on July 5 when the price broke through the pivot high after it has broke the short term declining trend line. Entry #2 was on July 15 when it broke above the engulfing candle’s high of the inside bar pattern. Another inside bar break out entry from #3 on July 18. For those that trade breakout, July 18 also provide entry #4 for breakout above the 5/14/13 high.
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| Figure 3 |
None of these entries are guarantee to be profitable. These entries are simply possibilities. Therefore, trade at your own risk and trade your own plan.
Disclosure: Long MGM
