The Wagner Daily – $ANET Breakout Confirmed by Volume

The Wagner Daily – , December 16, 2021

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MTG Market Timing Model – BUY (signal triggered on 12/15 close)

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:

• Per intraday alert, bought $NVDA.

Commentary:

A bullish reaction to the Fed meeting fueled a sharp rally in the last 90-minutes of trading that produced a follow-through day buy signal for the S&P 500 and Nasdaq Composite on day 8 of a new rally attempt.

The follow-through day is a well-known buy signal popularized by William O’ Neil that should be confirmed by bullish charts. Not all follow-through days are created equal. Some occur with a ton of charts ready to breakout while others are a dud.

The S&P 500 is leading the market higher with big cap leadership such as $AAPL, $MSFT, $ORCL, $QCOM, $MRVL, and $MU.

The faster moving growth stocks that we prefer to trade have been hit hard in Q4 and are still 20-40% off recent highs. These charts are not ready and will likely need 3-5 weeks more of basing to produce reliable buy points.

Stocks we are currently monitoring in addition to those mentioned above: $AMD $NVDA $MXL $PI $SNOW $SLAB $ANET $PSTG $F $AA $FAST $LCID

There is one official buy setup for Thursday in $MRVL, which we are looking to enter on slight weakness after a bounce off the 10-day EMA. Wednesday’s session was a bullish outside day, where the day’s high is higher than the prior day’s high and day’s low is lower than the prior day’s low. The close should be above the midpoint of the day’s range.

$ANET broke out to new highs from a bullish 5-week consolidation on Wednesday’s follow through day. The breakout was confirmed by volume which was 70% above average (40% or more is ideal).

No entry yet on $ANET, as we are waiting for a lower-risk buy point to emerge, such as a few hours of tight-ranged chop on the hourly chart or a slight pullback to the $135 – $136 area.

Add

If this is the beginning of a new rally, then we should see more setups develop along the way. Avoid chasing entries.

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

• none

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