ETFs and market commentary:
Stocks closed mostly flat on Tuesday on brisk trade. The Dow Jones Industrial Average and the Nasdaq closed fractionally higher, while the S&P 500 and S&P MidCap 400 both slid 0.1%. The small-cap Russell 2000 put in the worst performance as it slid 0.5%. The top performing sectors included retail, computer hardware and oil services. Sectors suffering the most damage included banking, coal, steel, transportation, real estate and precious metals.
The session ended with market internals mixed. Volume skyrocketed on the Nasdaq by 31.9% while the NYSE saw a 8.6% increase in trade. Declining volume outpaced advancing volume on the NYSE by a ratio of 1.8 to 1. However, on the Nasdaq, advancing volume ended the session at par with declining volume. Although price action was flat yesterday, the late day recovery was impressive and showed all the characteristics of an accumulation day. Technically, yesterday would not be classified as an accumulation day but the action was clearly bullish.
Last week we discussed the key resistance levels on the Nasdaq and the S&P 500. Since then, not much has changed, but given the price discussion that has been occurring between bulls and bears over the past week, it is probably a good time to once again review the state of the broad market. Below are monthly charts of the Nasdaq and S&P 500. Notice that the S&P is now within about 20 points of resistance at the previous swing high. As we stated last week, we anticipate that the current rally could stall when the S&P overcuts 1,370.
Over the past two day, the ProShares Ultra Oil & Gas ETF (DIG) tested support of its 10-day MA, but on both occasions reversed to close near session highs. A breakout above yesterday’s high of $49.62 could provide a buy entry trigger for this ETF.
The market came close to putting in a distribution day but a late session rally reversed the day’s fortunes. The fact that the market was able to reverse its trend late in the session, on a high volume day, suggests the bullish conviction in the market is quite high.
Today’s ETF Watchlist:
SOXL
Long
Shares = 200
Trigger = 40.73
Stop = 37.78
Target = 47.00 – 48.00
Dividend Date = n/a
Notes = See commentary from Feb. 14 report
XLU
Long
Shares = 500
Trigger = 35.12
Stop = 34.38
Target = 36.60
Dividend Date = n/a
Notes = See commentary from Feb. 10 report
IAU
Long
Shares = 800
Trigger = 17.13
Stop = 16.47
Target = new swing high
Dividend Date = n/a
Notes = See commentary from Feb. 8 report
PPH
Long
Shares = 300
Trigger = 74.04
Stop = 72.22
Target = new swing high
Dividend Date = n/a
Notes = We’ve been monitoring this trade for potential entry and it remains on our 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
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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 [email protected] if not already set up for this value-added feature we provide to subscribers.
We added BIIB to the Stock Watchlist. After a false breakout in early February, BIIB has pulled back and undercut the 20-day EMA on dry up in volume. Our buy entry is over the two-day high with a pretty tight stop.
NOTE: We are changing the name of the Full-Serve watchlist to the “Stock Watchlist” to reduce confusion so that both newsletters use the same terminology. Because of this, we will no longer have a Self-Serve watchlist.
Daily Stock Summary
Below is an overview of all “full-serve” open positions, as well as a performance report on all “full-serve” 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.
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Notes:
- Per intraday alert, sold FTI ahead of last night’s earnings report due to the lack of follow through from our entry. We book a small scratch gain.
- Note the changes to the IACI setup (again).
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