MLTX Post-Capitulation Play: Buying the 7.00 Shelf for a Push Toward 7.70

Executive summary

• Regime shift event: MLTX experienced an extreme breakaway gap down on 2025-09-29 (close ~61.99 to 6.24), with capitulation-scale volume (~79.7M shares). The next session (2025-09-30) printed a strong intraday recovery attempt with a high of 7.48, closing near 7.03, and current after-hours print ~7.17. This looks like a classic post-capitulation stabilization/mean-reversion setup with heavy two-way trade establishing a new value area.
• 24h view: The balance of evidence favors a continuation bounce/mean reversion into the 7.5–7.8 zone if price holds above intraday VWAP and the 6.85–7.00 shelf. Risk is a flush back toward 6.40–6.50 if that shelf breaks.
• Trade bias: Buy the dip into 7.00–7.05 with a target near R1/extension around 7.65–7.75 over the next 24 hours.

1. Price action and market structure

• Daily structure: A violent breakaway gap reset all prior reference levels. 2025-09-29 candle is a long-range day (LRD) with a lower tail (L=5.95) and small real body (O=6.97, C=6.25), resembling a hammer-like attempt at stabilization. On 2025-09-30, intraday action expanded higher to 7.48 before retracing to ~7.03, leaving a higher high vs. 9/29 and a higher low vs. 9/29’s low—an initial sign of basing.
• Intraday (hourly) structure: Two strong impulsive up bars (15:30, 16:30 UTC) drove price through 7.00 to 7.48, followed by a corrective retrace to 6.86 and re-accumulation around 7.00–7.17. This creates a developing value area with:
  • Support: 6.85–7.05 (hourly demand, prior pullback low ~6.86, and psychological 7.00)
  • Resistance: 7.30–7.48 (intraday supply high), then 7.75–7.90 (extensions)
• Pattern read: Post-capitulation “dead cat bounce”/mean reversion phase often carries for 1–3 sessions. The first bounce leg is underway; a second push toward the prior session high is probable if buyers defend VWAP and the 7-handle shelf.

2. Volume, order flow, and VWAP

• Capitulation volume: 79.7M on 9/29 and ~62.3M counted during the main 9/30 intraday hours show transfer of shares from weak to strong hands. Such volume typically marks at least a tradable low.
• Intraday VWAP (2025-09-30 main session): Approx. 6.89. Price is currently above that, signaling buyers maintained control into the close/after-hours.
• Anchored VWAP from 9/29 gap day (approx. daily typical price ~6.45): Current price ~7.17 remains above that anchor, a constructive sign.
• Volume by price (heuristic from hourly bars):
  • High-volume node (HVN) near 6.9–7.05 (multiple 10M+ hour bars printed in this zone). This forms the primary value area.
  • Low-volume zone (LVN) around 7.20–7.30; if breached, price can traverse quickly to test 7.45–7.50.
  • Supply reappears near 7.45–7.50 (today’s high) but, if absorbed, the path to 7.7–7.9 opens.

3. Volatility and ATR context

• New regime ATR: 9/29 range was ~1.19 (7.14–5.95); 9/30 intraday range ~1.40 (7.48–6.08). With price near 7, a 20% one-day range is within observed prints. A 24h move of +0.5 to +0.8 is realistic.
• Expectation: Elevated volatility persists as the market digests the structural event. Intraday swings of 0.30–0.60 can occur multiple times.

4. Momentum indicators (qualitative given regime change)

• RSI (hourly): After a deeply oversold state on 9/29, momentum shifted into a bull range on 9/30 (frequent closes above VWAP, higher highs). Pullbacks to the 40–50 RSI region (price ~6.9–7.0) are buyable provided the structure holds.
• MACD (hourly): Likely bullish cross on the surge to 7.48 with a shallow pullback—typical of early-stage recoveries.
• Note: Daily oscillators based on pre-gap data are less informative due to the structural reset.

5. Moving averages

• Legacy MAs (20/50/200-day) are obsolete versus the new pricing base. They will eventually roll down far above current price and should be ignored for near-term tactics.
• Short-term EMAs (5–10 period, hourly) have turned up; price reclaim above the hourly 20EMA (proxied by the VWAP zone) supports a bounce continuation.

6. Ichimoku (hourly focus)

• Tenkan > Kijun following the surge, price chopping near/below Tenkan on pullbacks. The Kijun baseline likely sits around the 6.95–7.05 area. As long as price holds above Kijun, trend continuation favors retests of 7.30–7.48.
• The cloud ahead is likely thin/flat around 7.2–7.3, creating a magnet if price remains above the base.

7. Bollinger Bands

• Daily bands have explosively widened; price is transitioning from lower band tag (9/29) toward the middle band. In new regimes, price often mean-reverts to or slightly beyond the mid-band before consolidating, consistent with a 7.5–7.8 test.
• Hourly bands compressed into the close with price above mid-band, a bullish posture indicating potential band expansion upward on the next impulse.

8. Fibonacci mapping

• Intraday swing (9/29 L 5.95 to 9/30 H 7.48 = 1.53):
  • 38.2% retrace ~ 6.90 (held repeatedly)
  • 50% retrace ~ 6.715 (did not trade sustainably below)
  • 61.8% retrace ~ 6.53 (untouched on 9/30 after the main surge)
  • This supports the thesis that the first impulsive leg has corrected shallowly and can attempt a second leg higher.
• Extensions off 6.86→7.48→6.94 suggest 1.272→1.618 targets around 7.75–8.05 on a clean breakout.

9. Pivot points (calculated from 9/30 session: H 7.48, L 6.08, C 7.03)

• Pivot (P): ~6.863
• R1: ~7.646
• R2: ~8.263
• S1: ~6.246; S2: ~5.463
• Tactical takeaway: R1 at ~7.65 aligns with the extension and supply zone confluence. This makes 7.65–7.75 a logical profit-taking band for a 24h long.

10. Elliott wave heuristic (intraday)

• From 5.95 low: Wave 1 to ~6.44, Wave 2 to ~6.33, Wave 3 to 7.48, Wave 4 to ~6.86, and an early Wave 5 attempt into 7.3x–7.4x. If Wave 4 completed at 6.86, a modest final push can retest or marginally exceed 7.48 before a deeper A-B-C pullback—consistent with a 24h rally attempt.

11. Statistical mean reversion

• A near-90% collapse day is an extreme outlier. The subsequent session typically exhibits positive drift as liquidity providers reprice and shorts cover around new fair value. The high share turnover further supports a short-term positive drift probability.

12. Scenario analysis (24h)

• Base case (60%): Hold above 6.90–7.00, push through 7.20 LVN, test 7.45–7.50, and extend toward 7.65–7.75 (R1/extension) before stalling. Close or consolidate near 7.4–7.7.
• Bear case (25%): Lose 6.90 decisively, accelerate through 6.75 toward 6.45–6.55 (anchored VWAP from 9/29 ~6.45). This risks a retest of 6.25 (S1) if sentiment sours.
• Bull tail (15%): Strong squeeze through 7.50, minimal pullbacks, and a run into 7.9–8.2 (R2 vicinity) if overhead supply is thin and momentum funds chase. Less likely in a single day but possible given volatility.

13. Risk management and execution plan

• Entry: Buy-the-dip near the 7.00–7.05 shelf where HVN/VWAP support clusters (limit order preferable). This buys strength-on-support rather than breakouts into supply.
• Confirmation: Maintain above intraday VWAP (~6.89) and reclaim 7.20 quickly after entry. If price lingers below 6.90, odds shift toward the bear case.
• Stop (discipline): 6.72–6.75 (below the 50% retrace of the 5.95→7.48 leg and under the 7.00 shelf), protecting against a deeper slide to 6.45.
• Target: 7.65–7.75 (R1 and 1.272 extension confluence). Partials can be taken ~7.48 (prior high) with the remainder aimed at 7.65–7.75.
• Risk/Reward: Entry ~7.03, stop ~6.73 (risk ~0.30), target mid ~7.68 (reward ~0.65): R:R ~2.1:1.

14. Additional notes

• Structural drivers: The magnitude of the gap suggests corporate action or a major fundamental event; while this analysis is technical, traders should monitor headlines for follow-through risk.
• Liquidity: Hourly bars show repeated 10M+ prints—ample liquidity for tactical entries/exits but expect slippage in fast moves around 7.20–7.30 LVN.

Conclusion

• With price above both intraday and anchored VWAP and a well-defined support shelf, probability favors a continuation bounce toward 7.6–7.8 within 24 hours, provided 6.90–7.00 holds. The optimal tactical plan is Buy on a pullback to ~7.03 with a target near 7.68.