--> Crude oil still in trend mode ($USO)

Crude oil still in trend mode ($USO)


market timing model: BUY

Current signal generated on close of July 11.

Portfolio exposure should at least be 75% to 100% long or more (if you can go on margin).

Past signals:

    • Neutral signal generated on close of July 5
    • Sell signal generated on close of June 24

(click here for more details)

 

today’s watchlist (potential trade entries):

$todays watchlist

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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. Changes to open positions since the previous report are listed in pink shaded cells below. Be sure to read the Wagner Daily subscriber guide for important, automatic rules on trade entries and exits. Click here to learn the best way to calculate your share size.
$todays watchlist

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closed positions:

open position summary

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ETF position notes:

  • No setups triggered

stock position notes:

  • $CCUR buy setup triggered. Note that the $VRX buy setup did not officially trigger due to the 5-minute rule. The new entry is posted above.



ETF, stock, and broad market commentary:

Stocks slid lower across the board on Monday, but losses were contained to the -0.2% to -0.4% range, with exception of the small cap Russell 2000, which gave back -0.8%. If the small cap index can’t snap back above the 10-day MA, then a pullback to the 20-day EMA may be in order by the end of the week.

Turnover was lighter on the NASDAQ but higher on the NYSE, producing a distribution day for the S&P 500 (but the distribution was mild). Although we have seen some distribution come into the market as of late, we still see healthy price and volume action in leadership stocks.

The recent post-earnings gap up action in Under Armour ($UA) and Facebook ($FB) is a bullish sign for the market, even if the market remains range-bound for another week or two to digest recent gains.

Our weekend ETF scans did not produce much in the way of actionable setups. Our $EWJ buy stop order remains live, but the price action broke down below the 50-day MA yesterday. Hopefully $EWJ can climb back above the 50-day MA by the end of the week. Pullback buy setups in $USO and $GSG remain in play. Note that the risk on $USO is only 5% of max because we are only adding back the 40 shares we stopped out of last week. Since the stop is only a point wide, the dollar risk is very small.

Guggenheim Solar ETF ($TAN) has struggled with the $28.50 level (top of the range) over the past 10 sessions. Because of this, $TAN may have to visit the lower end of the range around $27 to shake out some of the weak hands. We expect the price action to hold the $26.50 – $27 level, minus a shakeout day or two, as there is also support from the rising 20-day EMA.

$TAN TIGHT PRICE RANGE

The First Trust ISE Revere Natural Gas ETF ($FCG) hasn’t done much at all this year but chop around in a tight range. However, looking at the monthly chart below, we see that the current consolidation is just below the monthly downtrend line.

$FCG DOWNTREND LINE BREAKOUT

Note how the price range has tightened up nicely in 2013. While $FCG is currently not an actionable setup, it is something to keep an eye on for a potential breakout above $18.

On the stock side, $CCUR buy setup triggered. $VRX buy setup did not officially trigger due to the 5-minute rule. Note the new entry point in the watchlist section above. If you are already long $VRX, you can hold on to the position using the stop listed above. The $URI buy limit setup remains live as well. We raised the stop in $CPA to near break-even, as we are not in love with the price and volume action since our entry. It also reports earnings on 8/7, so at this point, we’d rather call it a small scratch and look to put the money elsewhere.

$DDD rallied almost 7% on heavy volume ahead earnings (Tuesday morning before the open). If $DDD gaps to new highs from earnings, then we should be in great shape. The position size in $DDD should represent only about 30-40% of max risk. We kept the size small due to earnings.

Facebook – ($FB) had a great reaction to earnings, gapping up above resistance (from prior highs) last Thursday and pushing higher the next few days on HUGE volume.

$FB EARNINGS GAP UP

The price and volume action on the gap up now make $FB a must own. However, we are in no rush to buy, as we should eventually see a low risk entry point develop on a pullback or breakout. The chart below details the weekly downtrend line breakout.

$FB downtrend line breakout

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