Investment in Casino Stocks Series II: MGM Mirage

Last week's post “Investment in Casino Stocks Series I: Las Vegas Sands” on Long & Short Investment presented a good strategy for entry point for LVS. Similarly in Series II of Investment in Casino Stocks, MGM Mirage also presents a good buying opportunity. Looking at one year chart of MGM, there is a clear descending trend line that has been consolidating for the past several months

and it recently broke out higher. Key resistance level to break will be at $14.25. Once MGM closes above $14.25, then this stock will take off higher.

However, I do expect a pullback toward its support line before reaching $14 range. When MGM retraces back to $10 range, it would present a good opportunity to go LONG. Remember just two years ago, MGM was trading around $80 range. Recently, the volume has increased considerably. In fact, it has increase on the average about 400% compared to 2007 and 2008. This is a very good sign for MGM.