The Wagner Daily – $PATH Bounces Off EMA Ahead of Earnings

The Wagner Daily – June 3, 2021

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MTG Market Timing Model – buy mode

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:

•    $UPST long triggered.
•    Per intraday alert, bought $NVDA.
•    Canceled the $GE buy stop.

Commentary:

Energy and retail led the charge on Wednesday with most indices basically flat on the day with a slight +0.1 to +0.2% gain.

Since reclaiming the 20-day EMA and generating a buy signal, the price action in the Nasdaq has been constructive. A little chop here is fine, as it would allow the 10-day EMA to catch up to the price.

$UPST buy stop triggered and was added to the model portfolio. $UPST is a must-own for us, though it’s quite volatile and tough to put on with size due to the wide stops. We have a buy stop in place on today’s watchlist to add to our position.

The ratings and eps/sales numbers on the chart below are from Marketsmith by IBD. For those not familiar with IBD ratings, shoot us an email at editors@morphuestrading.com.

Per intraday alert, bought $NVDA about 2% above the base high, which is the last buy point for us before a stock is too extended. In William O’ Neil’s “How To Make Money In Stocks”, his system allows buys up to 5% above the base high in a cup with no handle pattern like $NVDA. We prefer to go no higher than 2%, as 4-5% above the pivot makes it difficult to sit through a shakeout.

Looking for $NVDA to chop around and allow the 10-day EMA to catch up.

$LESL has formed a cup with handle pattern and is in play over Wednesday’s high. This is not an official setup.

$PATH’s inside day on Wednesday bounced off the 20-day EMA and closed above the 10-day EMA. A buy stop can be placed above the high of the inside day with a stop beneath the 2-day low. $PATH reports earnings next Tuesday 6/8. This is not an official setup.

Note that the $GE setup was canceled. The setup is fine but it is just a slower mover.

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

• $LESL – buy at 29.75, add at 30.40
• $PATH – buy at 82.51
• $COIN – buy at 245.00 for pop off the lows
• $NVCR – buy at 206.00
• Watching – $TUYA $PATH $SNAP $CRWD $NVDA $AMAT $UPST $ELAN $GS (pullback)

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