Melco Crown Entertainment traded very close to a long term profit level set earlier this year in May. MPEL traded to 6.10 on October 21, 2010, just 1.6% from the price target, but still up over 90% from the buy price alert.
MPEL is scheduled to announce earnings on Wednesday. This could bring some volatility to the stock depending on the outcome and what may or may not be priced into the stock. Longer term MPEL still has price targets upwards of 7.00 if corrections in the stock do not violate initial wave counts that have been developing and talked about recently in StockSignalTrader trading concepts.
Further, if the trading high in MPEL of 6.10 is in fact an internal wave 3, which it appears to be on a 15 min chart, then a new price target for this trade could reach 6.58. Trading between 5.80 and 5.60 before reaching this target could be within the short term trading range for this time frames wave price targets.
If the correction is complete after having already traded to 5.80 then the uptrend should continue. However, because wave 2 was a shallow correction, anticipate that MPEL could trade lower than this 5.80 price point as noted. Yet, if the MACD reading is correct a higher high in price should develop as the MACD creates divergence between its wave 3 and wave 5 and price recovers from the wave 4 correction shown in the chart below.
As with any trade be aware of larger time frame trends and price points prior to entering or exiting a trade within shorter trading time frames.
