The Wagner Daily – Trading Update: $GTLB Setup with Bullish Outside Candle

The Wagner Daily – May 5, 2022

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MTG Market Timing Model –  Sell due to both the S&P 500 and Nadsaq Comp below the 20 and 50-day MAs

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:

Stocks responded favorably to Wednesday’s Fed meeting and blasted higher during the last hour of trading. The S&P 500 and Nasdaq Composite both closed 3% higher on heavy volume. Wednesday’s session was day 3 of a new rally attempt and a step in the right direction for the market. Can new leadership emerge?

Crude oil has tightened up the past few months above the rising 50-day MA. Wednesday’s move cleared the highs of a tight-two-day range, which was buyable.  

Since the chart above is a futures contract, we have to buy $USO to gain exposure to crude. The buy limit order is set at 80.80 or less to guard against a gap up.  

$GTLB is another official setup with an entry based on Wednesday’s bullish outside candle, which cleared the downtrend line. We like the tight consolidation during the last few weeks that did not set lower lows with the market. We have a buy limit order to enter at Wednesday’s high or lower to avoid a bad fill due to a potential gap up. This stop is pretty wide due to the daily volatility, so we are going with small size.

Not an official setup: $LTHM gapped up and rallied 30% on huge volume, which is a powerful buy signal. A move through Wednesday’s high would trigger an unofficial buy.

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

• Longs – watching $CC $LTHM $OLN
• Shorts – none

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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