Contents:
- Trade Details
- Hybrid 10-Step Trading Strategy Review
- Final Trade Assessment
- Next Steps
Evaluating MER’s Closing Chart Using the Hybrid 10-Step Trading Strategy
Trade Details
- Stock: Manila Electric Company (MER)
- Market: PSE (Philippine Stock Exchange)
- Timeframe: 1-Day (Daily)
- Closing Price: ₱486.00 (-1.42%)
- Day’s Range: ₱486.00 - ₱494.40
- 20-MA: ₱484.71 (Short-Term Trend)
- 200-MA: ₱421.92 (Long-Term Trend)
- Volume: 164.98K (SMA 9)
MER stock price analysis on January 24, 2025, showing key pullback levels and trend indicators.
Hybrid 10-Step Trading Strategy Review
Step 1: Identify Market State & Trend Context
- Trend: MER remains in an uptrend as the price is above both the 20-day moving average (₱484.71) and the 200-day moving average (₱421.92).
- Positioning: The price remains in a consolidation phase near the previous resistance of ₱500. However, a pullback from recent highs suggests some short-term selling pressure.
Step 2: Assess Price Position Relative to Moving Averages & Key Levels
- The price is trading slightly above the 20-MA, indicating that the short-term trend remains intact.
- The 50% Sweet Spot Pullback level is ₱476.85, which could serve as a potential support zone.
Step 3: Power Bars & Retracement Strength
- No strong green power bars are present in the latest price action.
- The recent red candles indicate a retracement, but the price is still holding above the 20-MA, suggesting a healthy pullback rather than a reversal.
Step 4: Entry with Confirmation from Both Strategies
- The price is currently near the 25% Sweet Spot Pullback (₱490.18).
- If a bullish reversal forms in the next session, it could signal an entry opportunity.
Step 5: Tactical Stop-Loss Adjustments
- Stop-loss should be set below the 50% pullback level (₱476.85).
- A deeper retracement towards ₱450.20 (100% pullback) would indicate a trend failure.
Step 6: Color Change as a Secondary Confirmation
- A bullish reversal candle (green bar) near the 25%-50% pullback zone would confirm a potential buy signal.
Step 7: Profit-Taking Aligned with Retracement Targets
- First target: ₱503.50 (Recent high)
- Second target: ₱510+ (Breakout potential)
Step 8: Re-Entry at Secondary Retracement Pullbacks
- If MER retests the ₱476.85 level and bounces, another entry opportunity may emerge.
Step 9: Tactical Position Management
- Larger positions can be taken near the 33%-50% retracement zone (₱476-₱490).
- If the price falls below ₱450, the trend would likely be invalidated.
Step 10: Counter-Trend Trades Only When Retracement Fails
- Since MER is in an uptrend, counter-trend trades are not advisable unless a complete trend reversal occurs.
Final Trade Assessment
✅ Bullish Outlook: Despite the pullback, the price remains above key support levels and the short-term moving average.
⚠️ Key Levels to Watch:
- Support: ₱484.71 (20-MA), ₱476.85 (50% pullback)
- Resistance: ₱503.50 (previous high), ₱510 (breakout level)
📌 Strategy Moving Forward:
- Watch for a bullish reversal candle near ₱476-₱490.
- Enter with confirmation and set a stop-loss below ₱476.85.
- First target: ₱503.50; Second target: ₱510+.
Next Steps
- Traders should monitor if MER stabilizes near the 25%-50% pullback zone.
- A bounce above ₱490 would confirm the continuation of the uptrend.
- A break below ₱476 would indicate further downside risk.
Disclaimer: This post is for informational purposes only and should not be considered financial advice. Always do your own research before making any trading decisions.
Related Readings
- Micro Stock Trader: Comparing the Modified 10-Step Trading Strategy vs. Retracement Trading Strategy
- Micro Stock Trader Portfolio Tracker Page
