Category: The Wagner Daily – Archives

The Nasdaq 100 closed at a big support level. The current selloff is a bit different than the last two, as the index has clearly broken the 50-day MA.

The weekly chart of $QQQ has held the 20-week EMA on a closing basis during the entire rally. Will we see a change in character this month?

January 6, 2022

And just like that, the S&P 500 has turned into a false breakout.  A close of 1% or more below the 21-day EMA would trigger a sell signal.

Tuesday’s bearish reversal action in tech land stopped us out of $TQQQ, $AMAT, $TSLA, and $AMD. We remain long $MU with a tight stop to lock in a +4% gain.

With the exception of $TSLA, growth is off the table and we may stay clear of semis if they fail to hold Tuesday’s lows.

$AMD is a big leading stock within the group that has struggled as of late. The pattern remains intact for now.

Buy AMAT 3% position, entry 161.00, sell stop 156.59

After a short-term pullback, stocks reversed higher on Monday, with $QQQ, $SPY, and $XLK printing a bullish outside day on the daily chart. The outside day occurs when today’s low is lower than the prior day’s low and today’s high is greater than the prior day’s high, which can serve as the entry.

The bullish reversal action forced us into adding long exposure with buys in $AMAT, $AMD, and $TQQQ.

Rather than buy $QQQ, we bought the 3x leveraged $TQQQ for a swing.

 (see charts)

$AMAT was also triggered by an outside day. We have a buy stop in place to add over Monday’s high.

 (see charts)

$AMD triggered an entry (per intraday alert) over the prior day’s high as it reclaimed the 20-day EMA. Look for a break of the downtrend line as a shot to add. No official add yet.

Our game plan is to sit tight with two open positions and see how the market holds up on Monday. If further weakness leads to bullish reversal candles on the daily chart of the main averages, then we could see some pullback setups emerge on Tuesday or Wednesday.

Note the new stop on $ANET which was lowered just a bit (would result in a 4% gain if triggered).  

We remain long $MU with a stop beneath the low of the wide-ranged advance on 12-23. Look for support to come in around the 8-day EMA or 10-day SMA.

We are still operating under a buy signal; however, leadership is thin (semis) with defensive areas also leading (utilities & reits) which isn’t ideal.

Growth stocks remain out of favor.

For the most part, we are focused on stocks that have shown relative strength the past few weeks and are trading at or near 52-week highs.

$AMAT –  Wedneday’s tight-ranged inside day is a chance to add with a buy stop over the day’s high. This is an official setup.

Also, note that we canceled the $TSLA buy limit order for now but will continue to monitor the action.

There are two official setups on Wednesday’s watchlist. Both are buy limit orders to enter on weakness in $AMD and $TSLA. We did send out an alert to cancel the $AMD buy limit on Tuesday, but it’s back on the list for Wednesday.

$EXPE reclaimed the 50-day MA last week on heavy volume and has since chopped around in a tight range with light volume. Watch for a move through $183 and $186 to spark some buying interest. This is not an official setup.

Given the quick run up off the lows, there aren’t many setups out there with a low risk entry point. However, we only need a one or two-day pause in the stronger names to create a buy point, so we could be adding new positions on strength by Wednesday.

There is one new official setup on Tuesday’s watchlist, a pullback entry in $AMD near $150. The $TSLA pullback entry remains live (note the new entry and stop prices).

Per intraday alert, $MU and $AMD were added to the model portfolio due to the Nasdaq reclaiming the 20 and 50-day MAs.

We also have one new official setup for Monday in $TSLA on a pullback to the 50-day MA. We are looking for $TSLA to hold the 50-day MA minus some wiggle room, with a stop below the rising 10-day EMA.