Mallinckrodt (MNK) has been upgraded by TheStreet's Quant Ratings service, but it looks like the charts of MNK will need more than a quant upgrade to get it moving to the upside.
In this daily chart of MNK, above, we can see that shares suffered a steep decline from July to November last year. From December to date we can see a pattern of lower highs. Prices are below the declining 200-day simple moving average line. MNK tested the underside of that long-term average earlier this month and could break above it. Prices are also below the shorter 50-day average.
The On-Balance-Volume (OBV) line is pointed down and the momentum study is not giving us a clear signal in either direction.
In this three-year weekly chart of MNK, above, we see a possible descending or bearish triangle. We have lower highs and equal lows around $50 -- this shows more aggressive sellers meeting the same level of support around $50. When or if the support at $50 gives way, MNK should work lower.
The OBV line is pointed down on this weekly time frame and volume has generally dried up as this pattern has evolved. This is what the old technical books from 1910 tell us to look for.
A rally above $65 with strong volume would be needed to change the direction of MNK.