Commentary:

Stocks registered a solid session of gains on Thursday but trade was light. The market gapped higher at the open and spent the entire day mired in a trading range. All five major indices were up on the day, with the Dow Jones Industrial Average leading the advance. The blue chip index gained 1.4% on Thursday. The S&P 500 tacked on 1.3%, while the Nasdaq, S&P MidCap 400 and small-cap Russell 2000 ended the session up by 0.7%, 0.8% and 0.2% respectively.

Market internals ended the session mixed. Volume was noticeably down across the board. Turnover on the Nasdaq plunged by over 23%, while on the Big Board it fell by nearly 30%. The advancing to declining volume ratio ended the day at 4.2 to 1 on the NYSE and 1.8 to 1 on the Nasdaq. Thursday’s action appeared devoid of institutional involvement.

Our open positions in QID, EUM and RTH (short) are performing as we anticipated. EUM struggled yesterday but held support at our initial entry price. RTH was very weak compared to the broad market on Thursday. Should the market come under selling pressure on Friday, RTH could fall hard.

The iPath DJ-UBS Livestock Total Return Sub-Index ETN (COW) gapped down violently below both the 20 and 50 day moving averages on March 15th. Since then, COW has undercut the 200-day MA and is now poised to fill the gap. A rally back into the 20-day EMA could present a short entry trigger for this ETF. We are monitoring COW closely for a possible short entry.

The SPDR S&P Emerging Asia Pacific ETF (GMF) has lost support of the 200-day MA for the second time in as many months. Yesterday, this ETF closed near the low of the session on strong volume. A drop below the three day low of $78.35 could result in significant downside for GMF. For more aggressive traders, a partial short position could be entered below Thursday’s low. GMF is not an official setup but we are monitoring it closely for a possible short entry.

Yesterday’s lack of volume took a good bit of luster off of a positive day in the market. Further, there was divergence within the market. The Nasdaq, S&P MidCap 400 and small-cap Russell 2000 showed distinct relative weakness to the DJIA and the S&P 500. The rally clearly lacked broad based participation. NOTE: Today is a quadruple witching options expiration day. Typically this means there is a greater likelihood of increased volume and volatility. Index options, index futures, stock options and single stock futures all expire today.

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Today’s Watchlist:

There are no new setups for today. We will send an Intraday Alert if any new trades are made.

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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

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Notes:

• 
  No changes to our open positions.
  
  
• 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 support@morpheustrading.com if not already set up for this value-added feature we provide to subscribers.

Edited by Deron Wagner,
MTG Founder and
Head Trader