The following commentary was taken from our June 7 report which was delivered to subscribers Thursday night:
Our market timing model remains on a sell signal as we have yet to see a powerful follow through type day print in a major index. That being said, we’ve seen constructive price action this week in leadership type stocks and believe some long exposure is warranted.
The model portfolio is long $CDNA and $SE. Note that we canceled the $QTWO setup due to news of a secondary offering on Thursday. We will continue to monitor the action for an entry down the road if the chart holds up.
There are two new setups for Friday’s session in $MDB and $SPSC.
$MDB closed with a powerful reversal candle after recovering from a sharp morning selloff. We like the bullish closing action and want to establish some size on strength over the two-day high or on a pullback near the 10-day MA.
There are two buy setups (buy stop and buy limit). Whichever setup triggers first is the one we will officially take (the other is canceled). For those who can’t place such an order, simply go with the buy stop.
$MDB has a 99 relative strength rating from IBD and a 90 Composite rating. Its earnings per share rating is low at 46 due to the lack of earnings growth. However, revenue growth is impressive at +67%, +71% and +78% the past three quarters.
Our $MDB buy stop triggered on Friday’s open as the price exploded 5% higher in the first 30-minutes of trading.
$MDB closed just below $170, giving us an unrealized gain of 13%!
For those who would like to learn more about our style of trading please visit our Morpheus Trading Group blog.
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