Bullish Breakout and Reversal for Mallinckrodt MNK

Aug 2, 2016: 1:27 PM CST

If you’re looking for a bullish breakout and trend reversal candidate, look no further than MNK.

Mallinckrodt – a stock that’s been on our radar – bounced on positive divergences from $55.00 and now shattered resistance, officially reversing the downtrend into a new uptrend with today’s breakout.

Here’s the bigger picture:

Buyers rushed to support the stock through late 2015 and 2016 at the $55.00 per share level.

Positive divergences developed from the October lows to present.

The current swing takes the stock above both the 20 and 50 week EMAs along with the $70.00 per share pivot.

The assumption is that price will likely continue the new uptrend into the future (through “Open Air”).

Here’s the picture and today’s breakout as seen on the Daily Chart:

Buyers triggered a short-squeeze and breakout in late July above the $65.00 level – the falling upper trendline and the 200 day SMA – which set the stage for today’s August secondary breakout.

Share have indeed entered a bullish phase and have reversed the trend from down to up.

We’re seeing volume (today t least) and momentum (which was diverging) confirm today’s bullish action.

Focus on $70.00 per share and the weekly “Open Air” bullish plays into the future, especially after any pullback here.

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Corey Rosenbloom, CMT

Afraid to Trade.com

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1 Comment

One Response to “Bullish Breakout and Reversal for Mallinckrodt MNK”

  1. Faraz Says:

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