The Wagner Daily – Oil Stocks at Risk: CLR & OXY Battle 50-day MA

The Wagner Daily – July 25, 2022

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MTG Market Timing Model –  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.

today’s watchlist (potential trade entries):

open positions:

closed positions:

position notes:

• No trades triggered.

Commentary:

Last week’s trading was a mixed bag with solid gains on Tuesday and Wednesday that led to the Nasdaq Composite reclaiming its 50-day moving average. However, by the end of the week the feedback was negative (for our trading system), with most leading growth stocks failing to hold on to recent gains.  

Friday’s selloff was a distribution day for the Nasdaq Composite which is still above its 10, 20, and 50-day MAs. A pullback to the 50-day MA may lead to some low-risk entry points in leading stocks. However, a break of the 50-day MA on a closing basis would put our timing model on alert for a sell signal.

As of Friday’s close, growth is not ready to lead the market higher and may need a few more weeks of chop to produce quality patterns and lower-risk buy points. This is not a prediction, as we know that market conditions can change quickly.

As for the model portfolio, there were no new buys on Friday. We stopped out of $ENPH last Thursday at break-even ahead of earnings (after the bell on 7/26).

Note the new break-even stop in $LNTH ahead of earnings on 8/4. The $SWAV stop remains the same. 

$EVH and $HALO  failed recent breakout attempts above base highs but could be in play down the road with a few weeks of chop above key support levels.

Some oil stocks are at important levels and may be vulnerable to more selling if they fail to hold. $CLR and $OXY are struggling with the 50-day MA.

There are no new official setups for Monday, as our plan is to lay low and see how our stocks react to last Friday’s selling.

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

• Longs – $ITCI  (over prior day’s high)
• 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.

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

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