The Wagner Daily – Tight Action: $XOP

The Wagner Daily – May 7, 2021

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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market timing model: S&P 500 buy –    

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.

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today’s watchlist (potential trade entries):

open positions:

closed positions:

position notes:

• Canceled the $LESL buy setup.

Commentary:

Note – There is no video tonight, but will be back next Friday. For those new to our service, a short video replaces the commentary section of our report every Friday.

The S&P 500 closed with a bullish reversal candle after bouncing off support of the 20-day EMA. Can the index move to new highs from here and hold, or will the price need more time to digest the last advance?

For the third day in row, the Nasdaq held up at the 50-day MA and may be due for a bounce. Tough to get excited about the Nasdaq, as there isn’t much leadership left and resistance is only 1.3% to 1.8% higher.

There is one new official setup for Friday in the energy ETF $XOP.  We already have some exposure with $XEC but wanted a bit more.

We like the tight action at the 50-day MA after clearing the downtrend line. Our buy entry is over the high of Thursday’s bullish reversal candle and the high of 4/29 (the swing high). We have split stops, with half below Thursday’s low and the other half below the swing low.  

For those who are a bit more aggressive, the ETF $GUSH is also buyable using Thursday’s low as a stop.

Although $KSS has struggled to follow through since triggering a buy entry in the model portfolio, the price and volume action has been constructive. We especially like the dry-up in volume this week with Thursday’s volume possibly the lightest of the year. Looking for $KSS to hold the 50ma and eventually clear $63.  We have a bit of time to see some progress before earnings on 5/20.

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

• $DLTR – downtrend line break, buy at 116.00
• $OMF – buy at 56.45 (bullish reversal candle)
• $CF – buy limit at 51.10 (big move Thursday, looking for an entry on weakness)
• $SQM – buy at 54.01 (bullish reversal candle that could lead to downtrend line break)

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