Stock Trading Predictions & Technical Analysis: MGM

Monday, November 9, 2009

MGM - Looking to break its down trend

MGM - WAIT

MGM along other casino stocks had a nice jump today, and is looking to break its down trend. MGM is looking to build support at $10.00, and seeing the price hold up at this level tomorrow would establish this support level. I see MGM go to $11.00 before facing strong resistance at its 50 day MA. A strong move back above $11.00 and its 50 day MA would give us a BUY SIGNAL. However, it's hard to say if it will manage to break this resistance, and the reason I say this is because we can expect the market in general to pullback soon. But we never know, MGM did have at times strong moves upward when the market was down. That's why because of this uncertainty I am still maintaining my WAIT signal. However, MGM may have indeed bottomed after seeing it hold up around $9.00 on many occasions, and this is now a very strong support level. You may choose to go long now, but I would suggest setting a stop loss order below $10.00, which would not have you incur a loss of more than -7% or -8%. If you want to play it safer you should wait for a break above $11.00 that holds up. If the down trend persists however, going long right now may give you a small return but you may need to exit quickly. If I don't see MGM manage to break up over $11.00 and bounce back down along its down trend my VTSO that I have just set will probably get triggered in which I will cash in a minor return, which is still better than a loss.

MGM - LONG

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TECHNICAL INDICATORS

BUY SIGNAL: Indicates the possibility of the start of a new up trend or the continuation of the current up trend. This signal may be often given in the early stages of a potential new up trend that was preceded by a down or sideways trend. Such signals do not always succeed and may fail at time.

BUY: Indicates that the current up trend is already in motion and a BUY SIGNAL was already given earlier. A BUY does not necessarily indicate that the stock will continue higher from here, but simply that the stock is trending up. The further into the trend you decide to take a long position, the more risk you have of seeing it reverse back down sooner rather than later.

STRONG BUY SIGNAL: Indicates a stronger, more significant and reliable signal than a BUY SIGNAL which usually has less chance of failing. Such signals do not always succeed and may fail at time.

STRONG BUY: Indicates that the current up trend is already in motion and that STRONG BUY SIGNAL was already given.

SELL SIGNAL: Indicates the possibility of the start of a new down trend or the continuation of the current down trend. This signal may be often given in the early stages of a potential new down trend that was preceded by an up or sideways trend. Such signals do not always succeed and may fail at time.

SELL: Indicates that the current down trend is already in motion and a SELL SIGNAL was already given earlier. A SELL does not necessarily indicate that the stock will continue lower from here, but simply that the stock is trending down. The further into the trend you decide to sell a position, the more risk you have of seeing it reverse back up.

STRONG SELL SIGNAL: Indicates a stronger, more significant and reliable signal than a SELL SIGNAL which usually has less chance of failing. Such signals do not always succeed and may fail at time.

STRONG SELL: Indicates that the current down trend is already in motion and that STRONG SELL SIGNAL was already given.

HOLD: Indicates that traders who already hold this stock, should hold on as long as the trend persists. This signal is usually given during an up trend for which it would be considered too risky to take a long position at this point.

STRONG HOLD: Indicates that the current trend has been in motion for a while and rarely deviated away from the trend. Although the stock may continue higher, there may not be enough potential up side to trigger a BUY SIGNAL. This type of indicator usually means that the stock has very strong support levels which may have been tested but not broken.

WAIT: Usually given during a sideways trend for which we are waiting for a move that would trigger a BUY SIGNAL or SELL SIGNAL. This could also indicate uncertainty and the risk that would be taken if you were to take a long position at the current level. Taking a long position after giving a WAIT indicator is considered a gamble.