The Wagner Daily – Nasdaq Recaptures 20-Day EMA

The Wagner Daily – March 17, 2022

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MTG Market Timing Model –  BUY as of 3/16 close

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):

open positions:

closed positions:

position notes:

• No trades triggered.

Commentary:

The market showed some signs of life for the second day in a row with powerful price and volume action in most broad-based averages.

The S&P 500 gained +2.2% on higher volume, which qualified as a follow-through day buy signal. The close back above the 20-day EMA was also a positive sign provided that the price can hold the average during the next few days.

The Nasdaq Composite gained 3.8% on higher volume but did not qualify as a follow-through day as it was only day 2 of a new rally attempt. The price recaptured the 20-day EMA on a closing basis

This is not an official setup but maybe something we add to the portfolio via an intraday alert. Back above the 20-day EMA is a good start.

There are no new official setups for Thursday due to the lack of low-risk buy points in stocks trading 5-15% off highs.  

$PSTG is forming the handle portion of a cup with handle pattern. The relative strength line vs the S&P 500 has already broken out to new highs ahead of price. Let’s see if a lower-risk buy point develops within the next few days.

$GFS is a recent IPO from last October with good earnings and sales growth. There isn’t much to do up here after a +20% run up in tow days. On a wathclist for now, just monitoring. Like $PSTG, the relative strength line has already broken out ahead of price.

For those who are new to the service, our system is based on trading growth stocks that can explode higher in a short period of time…when conditions are ideal. For most of 2022, conditions have not been ideal, so we have been playing the short side when setups are there while waiting for a new buy signal. Below are a few things we are looking for in a buy signal.

Keys to market turning bullish:

• Buy signal in the timing model, such as a FTD (follow through day) or reclaim of 21-day EMA
• Stocks begin to breakout on volume and hold… indexes hold the 21-day EMA
• Number of stocks making new 52-week highs vs 52-week lows enters into positive territory
• After first wave of breakouts, new setups emerge

Unofficial Setups – For experienced traders only, no guidance is given for these setups.

• Longs – Watching $PSTG $SEDG $CARG $GFS
• Shorts –

See you in the chat room,

Rick 

This list is a good starting point for monitoring the health of the market for those who have limited time.

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