Commentary:

Equities rebounded solidly on Wednesday but the impact of the rally was lessened by light trade. All of the major indices closed higher led by a 2.7% gain in the small-cap Russell 2000. The S&P MidCap 400 closed higher by 2.2% while the S&P 500 added 1.6%. The Dow Jones Industrial Average tacked on 1.5% while the Nasdaq was the day’s laggard as it posted a 1.3% gain.

Internals were mixed on Wednesday as volume plunged by 16.3% on the Nasdaq and a massive 29.2% on the NYSE. Still, advancing volume topped declining by 8.9 to 1 on the NYSE and 2.0 to 1 on the Nasdaq. All in all, it was an unimpressive rally due to the light volume. Light volume is a clear sign that institutions were not participating in the day’s action. This serves to cast doubt on the breadth and strength of the rally.

The Pharamceutical Holders ETF (PPH) has recently pulled back and held support of both its 200 and 20-day moving averages. During the recent bear market move PPH demonstrated very good relative strength and appears ready for a move higher. A move back above the two day high of $68.28 could provide a long entry trigger for this ETF. We are placing PPH on the watchlist. Trade details are available to our clients in the watchlist segment of the newsletter.

The S&P Select Sector Technology SPDR ETF (XLK) has pulled back and held support of its 20-day EMA and 200-day MA. A volume fueled move back above yesterday’s high of $25.72 could provide a buying opportunity in this ETF.

The market appears staged for a move higher. In the face of very negative news it has been holding support and now appears ready to “climb the wall of worry” to higher ground.

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Today’s Watchlist:

PPH
Long

Shares = 300
Trigger = 68.37
Stop = 66.63
Target = New Swing High
Dividend Date = n/a

Notes = See commentary above

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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:

• No trades were made.
• 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