The Wagner Daily – Nasdaq Digests, Volatility Ahead

The Wagner Daily – August 2, 2021

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MTG Market Timing Model – cautious (growth stocks are not leading) 

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:

• Stop triggered in $CRWD for a smaller than usual $100 loss in the $50k model portfolio (avg loss is around $250-$300).

Commentary:

The Nasdaq Composite spent last week digesting the big reversal candle off support two weeks ago. If volatility remains high, then look for the Nasdaq to possibly test the rising 10-week moving average (a deeper pullback). If volatility dies down, then a few weeks of tight action would allow the 10-week moving average to catch up to price. These are just two scenarios of many that could play out.

Regardless of where we think the Nasdaq will be in a week or two, the price action in leading growth names the past few weeks has been disappointing. While a few stocks have broken out and extended higher, the overwhelming majority of recent breakouts have failed to impress.

Last week did see some buying in metals and mining, as well as semiconductors. These areas could see new buy setups emerge after a short term pause.

A few stocks we are watching are $NUE and $STLD. Both cleared resistance on heavier than average volume.

After stopping out of $CRWD last Friday, the model portfolio is down to two open positions in $NVDA and $SNAP. $SNAP could be in trouble with a break of Friday’s low. Our stop is split beneath Friday’s low and the recent swing low.

Note we lowered the stop in $NVDA to allow the price a little more breathing room in case there is another shakeout below $188.00. We’d like to see the price hold the 10-week moving average on the weekly chart which is just above the 50-day MA on the daily. The new stop is beneath the 50ma and -0.5% below the entry, so a very small loss if triggered.  The reason for entering in the first place was to catch the first pullback to the 10-week MA in a leading stock after a breakout from a long consolidation.   

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

Watching $NUE $STLD $TWTR $LC $MXL $SNAP $NVDA $DXCM $SMAR $SHOP $NIO $LI $XPEV $RIOT $MARA $ENPH $ZS $DOCU $FUV  

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