Stock Trading Predictions & Technical Analysis: MGM - Still in a down trend but may have bottomed

Friday, November 6, 2009

MGM - Still in a down trend but may have bottomed

MGM - WAIT

MGM's current major trend is still down, despite a recent bounce back up. MGM is currently standing just below its resistance level of $10.00, and may soon break over it to go to $11.00, before pulling back again. For MGM to give us a a BUY SIGNAL and start a clear uptrend it needs to move sharply back over its 50 day MA which is currently standing at $11.00. The stochastic also shows that MGM's major trend is down, despite not needing it to see it, obviously. In the past few sessions, I have taken positions on a couple of occasions and had my stop loss trigerred. However, I did see that MGM was started to build support around $8.80 and $9.00, where I took another long position (The stochastic also had given a BUY SIGNAL for this short term trend). This last position gave me a decent return when my trailing stop order was trigerred at $9.52 above my $8.80 entry point. Basically I was betting on the very short term, as I am doing now. After getting my stop loss trigerred yesterday, I somewhat felt it was a good thing with the earnings report coming up. This morning, I waited to see how the market would react and it was somewhat positive, although it did not have an extraordinary impact on the share price. With my current long position in MGM I'm betting on seeing move to $11.00 before pulling back, and if it continues higher, than the trend will have reversed and I will possibly gain more. However, I did enter a tight stop loss order in case MGM continues to trend back within the current narrow range of $8.80$10.00. Right now MGM is a WAIT, as it is still trending down, and a move above $11.00 is required for a clear BUY SIGNAL. My long position as the other one's did, may only last a day or two if MGM continues along its down trend. If you want to play it very short term as I am, you may want to wait and see if MGM pulls back again around $8.80-$9.00 and see it bounce back up, to get in.

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.