Commentary:
Stocks ended the day mixed on light volume. For the second consecutive day it appeared that the market might fall into a tailspin. However, stocks mounted a recovery within the first hour of trading and rallied into the close. Despite the light trade, technology issues fared well. The S&P MidCap 400 led all major indices as it posted a healthy 0.6% gain on Monday. The small-cap Russell 2000 and Nasdaq closed higher by 0.5% and 0.2% respectively. The S&P 500 slid 0.1% on the session, while the Dow Jones Industrial Average shed 0.3%.
Market internals were lackluster. Volume was off considerably on both indices. Turnover on the NYSE was down by nearly 12%, while volume on the Nasdaq dropped 5.8%. Declining volume outpaced advancing volume on the NYSE by a ratio of 1.2 to 1. On the Nasdaq, the advancing volume to declining volume ratio ended the day at a positive 1.3 to 1. Monday’s market internals provided no indication of institutional involvement in the broad market.
Yesterday, we entered one new position, reentered one that hit our stop and added to one of our open positions. Early in the session we were stopped out of PHO. However, due to the volume and price action in this ETF, we decided to reenter the trade late in the day. We added to our position in PBW as it advanced to an 11 month high. The decision to add to this trade was predicated on its relative strength and impressive volume. PBW remained strong during the early morning selling pressure and closed near the high of the day. It never traded lower than one cent below Friday’s close. IEV hit our trigger at the open. It gapped down less than 1% below our trigger, so the gap rules did not apply. Trade details for the reentry in PHO and the 400 shares we added to the position in PBW can be found in the watchlist segment of the newsletter.
The iShares MSCI Thailand Investable Market Index ETF (THD) sold off sharply yesterday on a significant increase in volume. A drop below the November 17th low of $62.03 provides a potential shorting opportunity in THD. We are placing THD on the watchlist. For our subscribers, trade details can be found in the watchlist segment of the newsletter.
From time to time we will get stopped out of a trade but get right back in. Such was the case with PHO yesterday. Our decision to reenter the position was based solely on technical analysis. Each trade stands of its own merits irrespective of when it is entered or exited.
Today’s Watchlist:
THD
Short
Shares = 200
Trigger = 61.94
Stop = 65.22
Target = 55.20
Dividend Date = n/a
Notes = see commentary above
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
Per intraday alert, we added 400 shares to our PBW long position. We also re-entered PHO late in the day after stopping out just after the open. The IEV short setup triggered.
- 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.
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Notes:
Edited by Deron Wagner,
MTG Founder and
Head Trader