MRVC--- look at setup forming for a breakdown - MRV Communications
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Yesterday we looked at Exodus Communications, EXDS for a possible breakdown.
Today, we can look at a similar pattern in MRVC. MRVC has been in a trading range between 51 and 62 for a couple of weeks. The stock today broke that 51 support. My expectation is that the stock will continue lower. I would exit any longs.
An aggressive trader may consider a short here. I would place a stop on a short in the 49 to 49 ½ area at 51 ¾.
Just as a stock breaks out to the upside to new highs for a period, other stocks will breakdown after hitting stops and confirming a downtrend.
Unfortunately, many stocks are also at critical support. Be careful and focus on protective stops. The NASDAQ is also at a critical support area.
Chart courtesy of
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The purpose of this Market Call section is to educate its readers in technical analysis patterns and indicators. As with all investment information, you need to research information and consult your financial advisor before initiating any strategies that are contained in Market Call. Also, you must realize that as with all trading strategies, opinions can change quickly depending on market conditions and developments. This column presents historical examples, potential set ups, and examples of entry and exit strategies.
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