I'm thinking $MGM is setting up for a mean reversion bounce trading currently at $29.28 with an RSI 12.96 on the 1 day at multi year support

$MGM has taken a beating recently, currently trading right around $29.28. The 1-day RSI is down to 12.96, which is about as oversold as a large cap gets without an absolute black swan event. It's hovering right on multi-year structural support. I run a strict mean-reversion strategy looking for short 5-day relief bounces on mega/large caps when RSI drops under 15. What are your thoughts? Is this a prime bounce setup or a trap?

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u/nuclearmeltdown2015 1 6 hours ago

IDK what their entire portfolio is right now but the industry is not doing well in Vegas I can tell you that much. Hospitality in general because people are spending less. If you see that changing then be my guest.
u/Life_Ant_450 1 6 hours ago

RSI that low is screaming oversold but support levels can break like wet paper if the fundamentals keep deteriorating
u/elpresidentedeljunta 1 5 hours ago

They dropped what? 25% in less than a month? The sector being in trouble doesn´t warrant that. And in the last 5 years they dipped only three times or so this low.
u/InterestingHeight267 OP 1 5 hours ago

Macro is weak, but that's already priced in with a 25% crash. RSI under 13 on a $10B+ market cap doesn't happen often. I'm not investing for 5 years, just trading a 5-day oversold bounce off the $29 support floor.
u/elpresidentedeljunta 1 5 hours ago

It´s likely oversold. The (final) crash happened when the takeover bid was rescinded. I get that people dump, but my viewpoint is that the original offer wasn´t overpaying the underlying value of mgm by 50%.
u/OilBull 1 5 hours ago

Zero. It’s going to zero.