ETFs and market commentary:
Equities closed lower yesterday on brisk trade. All five major indices ended the session in the red but well off session lows. The small-cap Russell 2000 led the decline for a second consecutive day as it fell 0.7%. The S&P MidCap 400 shed 0.6%, while the Nasdaq, Dow Jones Industrial Average and S&P 500 all slid 0.5%. Sectors performing well included internet services, banks and homebuilders. Sectors hit the hardest included coal, non ferrous metals, precious metals, oil exploration and services and heavy construction.
Market internals were bearish on Tuesday. Volume increased by 6.0% on the Nadaq and 12.1 % on the Big Board. Declining volume topped advancing volume by a ratio of 2.6 to 1 on the Nasdaq and 2.3 to 1 on the NYSE. Yesterday’s internals point to institutional distribution, as prices were lower on higher volume. However, the selling was somewhat tempered by the fact that all the major indices were able to rally late and close in the upper half of their respective trading ranges.
The Market Vectors Vietnam ETF (VNM) has been in a basing pattern since February 24th of this year. VNM has been selling off for the past two days and appears likely to test the swing low of $19.08 formed on March 24th. Ideally, we would like to see a reversal candle form on an undercut of this key mark. Alternatively, VNM could stabilize at the current level and reclaim the 20-day EMA. Regardless, a move above the three day high of $20.14 could present a buying opportunity in this ETF.
Yesterday, on a pickup in volume, the iShares MSCI Taiwan Index fund (EWT) put in place a reversal candle as it undercut its 20-day EMA. A volume fueled move above the four day high of $13.54 could offer a buy entry trigger in this ETF.
Despite the gap down and with the exception of EPU, all of our open positions formed reversal candles and closed near session highs. Following a two day run EPU took a rest yesterday and held support at its breakout bar. The selloff in EPU was on light volume. Although yesterday was technically a distribution day, the recovery in prices late in the session helped to mitigate much of the day’s damage. Market bears should not have been happy with how the session ended. It will be interesting to see how the market reacts to the last two days of selling pressure on Thursday.
Today’s ETF Watchlist:
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 DailySubscriber Guide for important, automatic rules on trigger and stop prices
Having trouble seeing the position summary graphic above? Click here to view it directly on your Internet browser instead.
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 [email protected] if not already set up for this value-added feature we provide to subscribers.
Most of our positions bounced off the lows into the close which is a good sign. As mentioned in Wedneday’s webinar, we plan to hold the majority of positions through a short-term pullback and sell in to strength on a potential second leg up.
TRAK makes it back on our watchlist due to yesterday’s bullish undercut/reversal bar. URI has formed a couple bullish reversal bars during the past week or two and is also a low risk entry over the prior day’s high. These entries may gap up on the open, so be sure to use the 5-minute high for any setup that triggers before 9:35 am. We will send an intraday alert to confirm any entry.
For those of you who are new subscribers please contact me at [email protected] if you have any questions regarding strategy, money management, or how to make the most out of this report.
Today’s Stock Watchlist:
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 model account size. Changes to open positions since the previous report are listed in red text below.
Having trouble seeing the position summary graphic above? Click here to view it directly on your Internet browser instead.
Notes:
- No trades were made.
Relative Strength Watchlist:
The Relative Strength (or RS) Watchlist makes it easy for subscribers to import data into their own scanning software, such as Tradestation, Interactive Brokers, and TC2000. The list is comprised of the strongest 100 (or so) stocks in the market over the past six to 12 months. The scan is based on the following criteria and is updated every Monday:
- Stock is in a well defined uptrend, trading above both the 50-day and 200-day moving averages, with the 50-day moving average above the 200-day moving average (both moving averages should be in an uptrend as well).
- Today’s close is less than 20% off the 52-week high
- Close is greater than $5.
- Volume is greater than 200,000 shares per day (using a 50-day volume moving average).
Click here to view this week’s Relative Strength Watchlist in excel
Click here to view this week’s Relative Strength Watchlist as a text file