McMoRan – MMR my recent portfolio addition is starting to look very bullish. In my book it looks like we are about to witness a break-out to the upside. I described what I was looking for, why I was patient with MMR and what made me think the trade has great odds of working. I added a bit to my position today. A few reasons why I am bullish on the stock:
- After my entry the stock dipped but the very next day the stock went up. Great trades work right away the saying goes.
- The stock is behaving exactly like I expected it to behave. That is always a very bullish sign.
- The day after I entered news of significant insider buying was published.
- Picture perfect ascending triangle. We are about 2/3 into the pattern. That’s where the best breakouts occur.
- The stock closed near the high of the day.
Some characteristics and charts patterns I am typically looking for:
- Rather long base.
- Game changing news / fundamentals.
- Abnormal volume surge.
- Gap up.
- Thrusting move.
- Consolidation pattern. Preferably an ascending triangle.
- Story stock potential.
- Potential to attract the momentum trader crowd.
- Market capitalization that leaves a lot of room for additional price appreciation.
MMR – McMoRan Exploration (NYSE) is displaying all those characteristics. It looks like trading above 17$ US Dollar will trigger stop buys. If the stock can break out, momentum traders will take notice and a whole new group of traders generating additional buying pressure will enter the scene. Let’s see what happens.
Up-to-date MMR McMoRan Exploration Chart on my public list.
You will notice I used the words: ‘Act accordingly’ in the chart annotations. I don’t do this very often. Relax, hold on to your position and be patient with your winners.
What you are afraid to do is a clear indicator of what you need to do.
Have a great evening!
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