AI
Friday, May 04, 2012 4:33:32 PM
Low put in for $MPIX, look for upside
In my post earlier today I gave the longs and bottom hunters a 1 year perspective on the movement of $MPIX price. Long story short, it took a 12 month trip up and came right back to where it started. The price, pattern, and time on the weekly chart points to upside, now lets take a look at the daily chart.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=75213754
As many of you can see, I have presented very thorough and multiple factor technical analysis of why the odds favor an $MPIX bounce. Many people fail at technical analysis because not only do they misinterpret chart signals, but they do not add multiple factors to increase their odds. Not only do I see multiple factors on the weekly chart, but I see multiple factors on the daily chart.
First, $MPIX had capitulation selling on 5/1. Look at the 5 mm shares traded at the lows, that was scared hands dumping at any price. Some stragglers came out on 5/2 but as you can see from the chart there was no volume selling either on 5/3 or 5/4. Why is there no more selling? It is because anyone who was going to sell this position already has. The bleeding has stopped. The argument about the "bids getting lower each day" is null because nobody is hitting the bid. I could make the argument that "the ask is getting higher every day" but that doesn't matter because there really isn't any volume hitting ask.
Second, $MPIX has hit a major support level last hit in September of last year. See my weekly chart analysis above, I go over the importance of support and the timing in detail. Wherever you go, the first hit of a support line gives you 80-90% odds of a bounce.
Third, no significant new intraday lows were made since the sell off. As they say in football, defense wins games. If the opponent can not score on you then you can not lose. The analogy applies to support. No new lows were made for 3 days in a row and so the path of least resistance is up.
Fourth, there are 4 reversal candles at the low. When price is pushed down to a low but ends up closing back in the top 25% of the candle that is a bullish signal because it tells you that in a clash between the bulls and the bears, the bulls are winning.
Fifth, all recent bounces in the stock have occurred towards the beginning of a new month and have taken it at least through the 20 day moving average. However, the first hit of a support level in 1 year could lead to a huge bounce up to the 200 day moving average area.
In the chart below you can see my price targets. I think that 1 cent is a very high probability hit, and for that matter target 2. These are areas where I will be taking some of my position off to lock in gains and leaving the rest with an exit at break even.
Hitting Target 3 is very reasonable as $MPIX was just there in April, however if the rally really gains steam you should look at the 200 DMA target 4 area. Much will depend on the pattern. From what I have seen of MPIX, it likes to rip higher, pullback an consolidate, and rip higher again.
For safety's sake however, I will look for exits if $MPIX starts to have trouble holding this week's lows. I think that the odds of that are maybe 10% in the near term, but I am a trader and the only thing that keeps me safe are my stop losses.
Have a great weekend MPIX bulls. Buy the fear, sell the greed, and ignore the hype.
In my post earlier today I gave the longs and bottom hunters a 1 year perspective on the movement of $MPIX price. Long story short, it took a 12 month trip up and came right back to where it started. The price, pattern, and time on the weekly chart points to upside, now lets take a look at the daily chart.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=75213754
As many of you can see, I have presented very thorough and multiple factor technical analysis of why the odds favor an $MPIX bounce. Many people fail at technical analysis because not only do they misinterpret chart signals, but they do not add multiple factors to increase their odds. Not only do I see multiple factors on the weekly chart, but I see multiple factors on the daily chart.
First, $MPIX had capitulation selling on 5/1. Look at the 5 mm shares traded at the lows, that was scared hands dumping at any price. Some stragglers came out on 5/2 but as you can see from the chart there was no volume selling either on 5/3 or 5/4. Why is there no more selling? It is because anyone who was going to sell this position already has. The bleeding has stopped. The argument about the "bids getting lower each day" is null because nobody is hitting the bid. I could make the argument that "the ask is getting higher every day" but that doesn't matter because there really isn't any volume hitting ask.
Second, $MPIX has hit a major support level last hit in September of last year. See my weekly chart analysis above, I go over the importance of support and the timing in detail. Wherever you go, the first hit of a support line gives you 80-90% odds of a bounce.
Third, no significant new intraday lows were made since the sell off. As they say in football, defense wins games. If the opponent can not score on you then you can not lose. The analogy applies to support. No new lows were made for 3 days in a row and so the path of least resistance is up.
Fourth, there are 4 reversal candles at the low. When price is pushed down to a low but ends up closing back in the top 25% of the candle that is a bullish signal because it tells you that in a clash between the bulls and the bears, the bulls are winning.
Fifth, all recent bounces in the stock have occurred towards the beginning of a new month and have taken it at least through the 20 day moving average. However, the first hit of a support level in 1 year could lead to a huge bounce up to the 200 day moving average area.
In the chart below you can see my price targets. I think that 1 cent is a very high probability hit, and for that matter target 2. These are areas where I will be taking some of my position off to lock in gains and leaving the rest with an exit at break even.
Hitting Target 3 is very reasonable as $MPIX was just there in April, however if the rally really gains steam you should look at the 200 DMA target 4 area. Much will depend on the pattern. From what I have seen of MPIX, it likes to rip higher, pullback an consolidate, and rip higher again.
For safety's sake however, I will look for exits if $MPIX starts to have trouble holding this week's lows. I think that the odds of that are maybe 10% in the near term, but I am a trader and the only thing that keeps me safe are my stop losses.
Have a great weekend MPIX bulls. Buy the fear, sell the greed, and ignore the hype.
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