The Wagner Daily – 2x Inverse Oil & Gas ETF $DRIP in play post strong reversal

The Wagner Daily – June 30, 2022

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MTG Market Timing Model –  SELL (Nasdaq Comp. closed below the 20-day EMA)

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 new official setups

Commentary:

Since reclaiming the 20-day EMA with a follow-through day last Friday, the Nasdaq Composite has failed to hold key support levels (20-day EMA, last Friday’s low, and 50% fibo). In pre-market trading, Nasdaq 100 futures broke Wednesday’s low, which increases the odds of further selling in the short term.

Last weeks’s late buying did not hold up well this week, which is disappointing for the bulls.

There are no new official setups for Thursday, but we have a few unofficial setups to watch on the long and short side below.

$DRIP is a 2x inverse Oil & Gas Bear ETF. Wednesday’s strong reversal suggests another leg up after a brief pullback. Do not chase the price action, but an entry near Wednesday’s close is doable. It’s a volatile ETF, so one should probably reduce size to handle a wide stop or exit if the price retraces more than half of Wednesday’s reversal.

$MOS sliced through the 200-day MA last week and failed a recent attempt to reclaim the 200 the past two sessions. A break of Wednesday’s low could spark another sell off. A protective stop can be placed at the 200-day MA (for aggressive traders) or Wednesday’s high.

On the long side, $HQY and $LNTH are a few charts we continue to monitor.

Can $HQY’s handle hold the 50-day MA?

$LNTH above Wednesday’s high is interesting, but if market conditions weaken the trade may not be worth taking.

As mentioned above, there are no new official setups as we sit 100% in cash waiting for lower-risk setups to emerge.

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

• Longs – see above
• Shorts – see above

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.

https://morpheustrading.com/services/swing-trade-alerts

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