MCP is now on a potential breakout from both the 4-month downtrend line and the Inverse Head and Shoulder pattern supported by good volume with measured targets at 2.8 and 3.5 respectively.
*The 15-month downtrend line has been broken already.
*MCP bottomed out already at 1.15.
*ADX still points to a weak trend and more of a sideway price action (consolidation).
*No buying pressure yet (Chaikin Money Flow).
Previous MCP chart update containing this potential Inverted H&S pattern can be found here:
http://psetrends.blogspot.com/2016/02/mcp-chart-update.html
Trading Plan
- Buy near the breakout area.
- Set target depending on the breakout pattern (2.8 for the downtrend line breakout and 3.5 for the Inverted H&S).
- Set the stop-loss just a few points below the right shoulder's low (1.86).
- This is a high risk trade for the downtrend line breakout play as the risk/reward ratio is very small (around 1:1). Around 1:2 risk/reward ratio for the Inverted H&S breakout play.
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