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The Wagner Daily – February 3, 2022
Below is the full, archived issue of The Wagner Daily swing trading report (sent to members the night before the publication date).
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MTG Market Timing Model – BUY (from 2/1 buy signal)
Our timing model was designed to keep our trades in line with the prevailing market trend, not to call tops or catch bottoms in S&P 500 or Nasdaq Composite.
today’s watchlist (potential trade entries):
closed positions:
position notes:
- Per intraday alert, bought $MTDR.
- Note the higher stop in $CF, which is below the big up day on 2/1
Major indexes climbed higher on Wednesday, but the damage was done after the closing bell as $FB closed -22% lower in after-hours trading.
As of this writing, S&P 500 and Nasdaq 100 futures are trading -1% and -2% lower respectively. If futures remain weak, that would lead to a significant gap down on Thursday’s open, which would not be an ideal spot to initiate new shorts.
Prior to the $FB plunge, $MTDR was added to the model portfolio to gain some exposure to the energy.
We entered prior to the base breakout on a break of the hourly downtrend line off the 20-period EMA. This entry was closer to the buy point on 2/1 which was over the high of a tight two-day range.
Let’s see how our open positions which have shown relative strength respond to broad market weakness. Given the potential for a significant gap down on Thursday there are no new official setups.
Unofficial Setups – For experienced traders only, no guidance is given for these setups.
Depending on market conditions:
- Longs – $HAL $SM $SLB over Wednesday’s high – several other oil stocks also look good.
- Shorts – Waiting for a bounce due to potential gap down
See you in the chat room,
Rick
For those new to this report, our share size is pretty conservative with max. size around 10% of equity per trade. We do this because we prefer to trade 10-12 names to keep the report active. However, if your goal is to maximize returns, taking 18-25% positions is the way to go. If trading in a non-margin account, this will limit the portfolio to 4-5 positions. If on margin, then 8-10 positions. Our risk per trade on average is just over 1/2 of 1%. Experienced traders may want to risk 1% to 2% per trade. For example, a 20% position in a 100k account with a 6% stop loss would result in a $1,200 loss (1.2%).
This list is a good starting point for monitoring the health of the market for those who have limited time.
https://morpheustrading.com/services/swing-trade-alerts
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