Be Cautious ($XRT) ($DUG) ($SOXS)

today’s watchlist (potential trade entries):

today's watchlist

open positions:

Below is an overview of all open positions, as well as a report on all positions that were closed only since the previous day’s newsletter. Net P/L figures are based on two separate $50,000 model portfolios (one for ETFs and one for stocks). Changes to open positions since the previous report are listed in a pink shaded cell below. New entries are shaded in green cells. Be sure to read the Wagner Daily subscriber guide for important, automatic rules on trade entries and exits.

open position summary
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closed positions:

open position summary
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ETF position notes:

  • DUST and SOXS triggered.

stock position notes:

  • XLNX triggered.

SPECIAL NOTE: Just to clarify, in case there was any confusion, there will NOT be a reduction in the number of trade setups provided with our service. The plays will simply be listed in the “today’s watchlist” section every day rather than entered without notice in the middle of the trading day. As always, the number of trades entered will depend on market conditions. 

ETF and broad market commentary:

Stocks ended the session mixed on Friday after showing early promise. The market gapped up at the open but faded into the close, leaving all the major indices well off session highs and the Nasdaq in the red. The tech-rich Nasdaq was higher by as much as 0.9% yesterday before fading to post a 0.2% loss. The small-cap Russell 2000 ended higher by 0.6% and was followed closely by the Dow Jones Industrial Average, which posted at 0.5% gain. The S&P Midcap 400 landed a 0.3% gain while the S&P 500 closed just over 0.1% higher. Some of the day’s big losers included coal, gold miners, computer hardware, semiconductors and airlines. On the positive side, the homebuilder and software sectors showed relative strength throughout the session.

Although Friday was an options expiration day, volume ended the session mixed. While volume on the Big Board spiked by 17.4%, it slid by 3.8% on the Nasdaq, allowing the higher beta index to avoid distribution. Advancing volume topped declining volume on the NYSE by 1.3 to 1 but underperformed on the Nasdaq by a margin of 1.2 to 1. Despite the higher volume and higher advancing volume, it would be hard to consider Friday as an accumulation day on the NYSE, due to its weak price action into the close.

On Friday, the ProShares UltraShort Oil and Gas ETF (DUG) formed a reversal candle, as it undercut support at the 3-day low but rebounded to close near the day’s high. A move above the four day high of $24.81 could present a buy entry trigger for DUG.

ProShares UltraShort Oil and Gas ETF (DUG)

SSince pulling back into its 50-day MA on April the 10th, the SPDR S&P Retail ETF (XRT) has demonstrated relative strength to the broad market. Unlike the S&P 500 or the Nasdaq, XRT has reclaimed it 20-day EMA. If the market reverses higher, XRT should be one of the first ETFs to seek new highs. A move above the four day high of $61.66 could present a buying opportunity in XRT.


We entered two trades on Friday as both DUST and SOXS hit their respective triggers. EPU formed an inside candle and managed to close in the top third of its intraday range, and now appears poised to make a move higher. KBE remains on the watchlist and it also formed an inside candle, as it held support at its 50-day MA. Money appears to be rotating around various sectors in the market. This is supported by the fact that both our short and long positions are acting well. Since we are near important support levels on all the major indices, we are keenly aware of the potential for a sharp move in either direction. Although it appears that the market could be headed lower, don’t be surprised if we see an undercut and sharp reversal near the current support levels.

stock commentary:

Our weekends scans did not produce much in the way of actionable buy setups; however, there are a handful of stocks that may only need a few more days of consolidation before they are ready to launch higher (depending on market conditions). A few of these stocks are CAB, AAP, DG, MA, TITN, FTNT, ULTA, and VOXX. We have one new official setup today, which is a short entry in ORCL.

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