MRC Allied, Inc. (MRC) Analysis
MRC Allied, Inc. broke above its previous resistance ₱0.27 when it closed at ₱0.29 and went up by 21.85 percent on October 8, 2020. MRC printed a total turnover value worth nearly ₱220 million, with over 745 million traded shares.
The local traders were the main drivers of MRC Allied, as nearly 99 percent of the total turnover value was attributed to their trades. The foreign investors registered a net foreign selling worth nearly ₱2.50 million. If you look closely at the Net Foreign’s histogram, you’ll notice that today’s net foreign’s bar is the tallest year-to-date. However, it’s a relatively insignificant amount, so I’m not going to dwell that much on foreign investors’ participation in trading MRC Allied.
MRC Allied attempted to break two more resistance levels at ₱0.29 and ₱0.33, but the ascent wasn’t sustained, so it dropped back between ₱0.27 and ₱0.29, the prevailing support and resistance levels, respectively.
On the other hand, I classify MRC as an extremely high-risk stock already due to its 10-day historical volatility score of 122 percent. This risk level shows that MRC Allied historically shows habitual erratic price movements. You don’t want to be involved in trading an erratic stock if you’re a new trader or investor. What fits you are securities with a low- to moderate-risk level stocks. These are stocks with a historical volatility score not higher than 70 percent, preferably below 50 percent.
The last price is already trading above the 10-day simple moving average, and the MACD line already registered a golden cross above the signal. Therefore, my 10SMACD combo for MRC is already bullish. But, how about its Momentum Power Indicator? It got to be bullish, too, so there’ll be a confirmed buy signal for MRC Allied. Let’s check my trade-volume distribution analysis to find out.
Trade-Volume Distribution Analysis: MRC Allied
Last Price: ₱0.29
VWAP: ₱0.29
Dominant Range: ₱0.28 – ₱0.30
My Momentum Power Indicator has four elements. Please review or re-watch our online stock market course (if you’re one of our clients at Equilyst Analytics) to know what those four elements are.
Preferably, the last price must be higher than the volume-weighted average price (VWAP). In this case, I see a tie. There’s a tug-of-war between giving MRC Allied a bullish and a bearish Momentum Power Indicator. The other three elements are bullish, though.
True Market Sentiment – EOD (October 8, 2020) – MRC Allied
True Market Sentiment: BULLISH
6 of the top 10 brokers registered a positive Net Amount
6 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱0.2976
Top 10 Players’ Selling Average: ₱0.2959
7 out of 73 participants or 9.59% of all participants registered a 100% BUYING activity
13 out of 73 participants or 17.81% of all participants registered a 100% SELLING activity
True Market Sentiment – WTD (October 5-8, 2020) – MRC Allied
True Market Sentiment: NEUTRAL
6 of the top 10 brokers registered a positive Net Amount
5 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱0.2898
Top 10 Players’ Selling Average: ₱0.2897
8 out of 76 participants or 10.53% of all participants registered a 100% BUYING activity
12 out of 76 participants or 15.79% of all participants registered a 100% SELLING activity
True Market Sentiment – MTD (October 1-8, 2020) – MRC Allied
True Market Sentiment: BULLISH
6 of the top 10 brokers registered a positive Net Amount
6 of the top 10 brokers registered a higher Buying Average than Selling Average
Top 10 Players’ Buying Average: ₱0.2879
Top 10 Players’ Selling Average: ₱0.2880
9 out of 77 participants or 11.69% of all participants registered a 100% BUYING activity
12 out of 77 participants or 15.58% of all participants registered a 100% SELLING activity
Despite the topsy-turvy status of MRC’s Momentum Power Indicator, my True Market Sentiment’s overall sentiment across three timeframes is bullish.
If you’re fond of piggy-backing brokers, pay attention to the moves of COL Financial and Timson Securities. Abacus Securities is consistently disposing of MRC shares, on the other hand.
Recommendations for MRC Allied
Is your trailing stop intact? Monitor it closely, then. I cannot technically give MRC Allied a confirmed buy signal yet due to its last price tied up with its volume-weighted average price on Thursday. It would be best if you had made an upward adjustment on your trailing stop by now. That’s what I taught you (if you’re one of our clients) in the Evergreen Strategy in Trading and Investing in the Philippine Stock Market (our online stock market course). Do not buy more shares yet. Avoid the fear of missing out so you can have a profitable and stress-free experience in the stock market.
If you do not have MRC Allied yet, it’s more logical to wait for it to break out above the resistance at ₱0.29, so you’ll have a bigger potential reward than your potential risk. Look at the daily chart of MRC. Don’t you see that the last candlestick is already closer to the immediate resistance than its immediate support? Review our online stock market course so you’ll be reminded of the steps that you need to go through before you do a test-buy within the dominant range once there’s a confirmed buy signal.
You may use our reward-to-risk ratio and trailing stop calculators in the TOOLS tab of our online stock market library for free.
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