Commentary:

Equities performed well on Thursday pacing all five major indices well into positive territory. By the closing bell the S&P 500 tacked on 1.4% while the Dow Jones Industrial Average and small-cap Russell 2000 followed closely as both gained 1.2% yesterday. The S&P MidCap 400 closed 1.0% higher as the Nasdaq improved by 0.7%.

Market internals were decidedly bullish yesterday. Turnover spiked on the Nasdaq by 26.5% and on the NYSE by 21.9%. Advancing volume outpaced declining volume by a ratio of 5.0 to 1 on the NYSE and 1.9 to 1 on the Nasdaq. The significant increase in volume points clearly to institutional buying on Thursday. Based on the strong price action and strong internals we would classify Thursday as an accumulation day across the board.

On a pullback we opened a long position in SLV yesterday. For our subscribers, trade details are posted in the open positions segment of the newsletter.

Since a breakout move on June 28th the SPDR S&P Biotech ETF (XBI) has been consolidating along its 20-day and 50-day moving averages for the past three weeks. Yesterday, on a twelve day high in volume, XBI gapped up and rallied to close near the high of the day. A move back above yesterday’s high of $75.05 could provide a buy entry trigger for this ETF.

Yesterday, on a spike in volume, the iShares MSCI All Peru Capped Index ETF (EPU) gapped up, rallied sharply and eventually sold off sharply to form a bearish reversal candle. EPU may now offer a shorting opportunity below yesterday’s low of $42.88. We are monitoring EPU closely for a potential short entry.

The broad market is now again within striking distance of its two year high. A follow through day on Friday could serve to confirm that the market is prepared to surge to new highs.

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Today’s Watchlist:

There are no new setups for today. As always, we will send an intraday alert if any new trades are made.

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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

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Notes:

• Per intraday alert, we bought SLV on a pullback to the swing highs of May. Late in the session UUP hit its stop and we exited the trade.
• Reminder to subscribers – Intraday Trade Alerts to your e-mail and/or mobile phone are normally only sent to indicate a CHANGE to the pre-market plan that is detailed in each morning’s Wagner Daily. We sometimes send a courtesy alert just to confirm action that was already detailed in the pre-market newsletter, but this is not always the case. If no alert is received to the contrary, one should always assume we’re honoring all stops and trigger prices listed in each morning’s Wagner Daily. But whenever CHANGES to the pre-market stops or trigger prices are necessary, alerts are sent on an AS-NEEDED basis. Just a reminder of the purpose of Intraday Trade Alerts.
• For those of you whose ISPs occasionally deliver your e-mail with a delay, make sure you’re signed up to receive our free text message alerts sent to your mobile phone. This provides a great way to have redundancy on all Intraday Trade Alerts. Send your request to support@morpheustrading.com if not already set up for this value-added feature we provide to subscribers.

Edited by Deron Wagner,
MTG Founder and
Head Trader