Commentary:
Stocks ended the day mixed as volume waned. The Dow Jones Industrial Average was the only, of the five major indices, to post a loss yesterday, as it closed lower by a modest 0.1%. Higher beta stocks led the day as the Nasdaq, small-cap Russell 2000 and the S&P MidCap 400 all tacked on 0.3% by the closing bell. The S&P 500 ended the session fractionally higher.
Market internals ended the session mixed. Volume slid by 5.6% on the Nasdaq and 9.7% on the NYSE. However advancing volume once again topped declining volume on both exchanges. By the close, the ratio of advancing to declining volume stood at +1.6 to 1 on the NYSE and +1.5 to1 on the Nasdaq. Wednesday gave all the appearances of a consolidation day, as the major indices all traded in a tight range near the two day high. Every pullback seemed to find a bid. Yesterday’s light volume points to a lack of institutional involvement in the day’s price action.
The First Trust Dow Jones Internet ETF (FDN) has been consolidating just above its 20-day EMA for the past four sessions. A move above the four day high of $32.89 could provide a buy entry trigger for FDN.
Yesterday, the iShares MSCI All Peru Capped Index ETF (EPU) formed a massive reversal candle, as it undercut 200-day MA, filled the gap formed on Tuesday, and recovered to close near session highs. Notice that EPU is also on the precipice of rallying above its long term downtrend line. A volume fueled move above yesterday’s high of $40.40 could present a long opportunity in this ETF. Ideally, we would like to see EPU consolidate for several days prior to an attempted move higher. We are closely monitoring EPU as a possible trend reversal candidate.
Our open positions in IYT and IYZ showed relative strength yesterday, as they closed higher by 0.4% and 1.2% respectively. XRT remains on the watchlist, but never came close to triggering yesterday. For the most part, Wednesday was an uneventful consolidation day for the broad market. For a second consecutive day, the big winners were industry groups that have lagged over recent months. It is noteworthy that all of the major indices are at, or close to major resistance levels and a pullback from the current levels is a distinct possibility.
Today’s Watchlist:
XRT
Long
Shares = 250
Trigger = 53.21
Stop = 51.17
Target = 55.50 – 56.00 area (will send alert)
Dividend Date = n/a
Notes = see commentary from Jan. 9
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
- 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.
Having trouble seeing the position summary graphic above?
Click here to view it directly on your Internet browser instead.
Notes:
Edited by Deron Wagner,
MTG Founder and
Head Trader