Commentary:
Stocks moved higher on Tuesday on brisk trade to post another accumulation day. Stocks rose across the board as all five major indices closed in positive territory. The small-cap Russell 2000 tacked on 1.4% while both the Nasdaq and the S&P 500 gained 1.2%. The S&P MidCap 400 added 1.0% and the Dow Jones Industrial Average rose 0.8%.
Market internals ended the session on a bullish note. Turnover was up on the Nasdaq by almost 8.0% and on the Big Board by 12.6%. Advancing volume easily outpaced declining volume on the NYSE by a factor of 4.5 to 1 and on the Nasdaq by a factor of 3.5 to 1. The uptick in volume points directly to institutional accumulation and helps to further solidify the likelihood that this rally is legitimate.
Our positions in both PPH and XRT broke above the three day high and now appear ready to set new swing highs. However, despite the positive price action and internals, the market could easily continue to chop sideways for several weeks before potentially moving higher. We are now approaching key resistance and the last time we saw these levels the market pulled back sharply. A quick look at the charts of the S&P 500 and the Nasdaq.
Our open positions in XRT and PPH continue to act well as they have been consolidating for a possible move higher. With a little cooperation from the market both trades should perform well. Our market bias continues to be bullish but we are still patiently waiting for new leadership stocks to emerge. For the moment, all that would cause major concern for the long side of the market would be the emergence of further distribution days.
Today’s Watchlist:
There are no official setups for today. As always, we will send an intraday alert if any new trades are made.
Daily Performance Report:
Below is an overview of all open positions, as well as a performance report on all positions that were closed only since the previous day’s newsletter. Net P/L figures are based on the $50,000 Wagner Daily model account size. Changes to open positions since the previous report are listed in red text below. Please review the Wagner Daily Subscriber Guide for important, automatic rules on trigger and stop prices
- No trades were made.
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Notes:
Edited by Deron Wagner,
MTG Founder and
Head Trader