MGM Breaking Out?

Published on Monday, 11 January 2010 14:06 Written by Danny Miller

New York, Jan 11^th (TradersHuddle.com) – Shares of MGM Mirage (NYSE:MGM) are moving pass resistance above the 200 day exponential moving average, effectively breaking away from the ‘limbo’ zone, which is the gap between the 200 day simple and exponential moving averages that usually is conducive of a sideways range in the stock.

MGM Mirage operates 17 wholly-owned casino resorts and has 50% investments in four other casino resorts. The casino resorts operated by the MGM include luxury resorts, casinos, golf courses, shopping outlets, thrill rides and amusement zones. Bellagio, The Mirage, New York Hotel and Casino, Buffalo Bill's Resort and Casino are some of the hotels, casinos and entertainment resorts that are owned and operated by the Group's subsidiaries

Momentum traders will be looking at the stock, because it is now clearing a major hurdle for the whole sector to catch fire and start moving convincingly to the upside.

MGM’s stock previous range was pretty much stuck below $11 with several dips well below $9. The stock is a bit over-extended, as it has been rallying for the past few days up from lows around $9.

Traders wanting to establish a position in MGM should consider the entry point as it breaks this known resistance area, and should place stop loss just below the 200 day exponential moving average.