Commentary:

For a second consecutive day stocks rallied impressively into the close. However, Friday’s trade was light. The major indices all finished higher, with the Russell 2000 leading the way. The small-cap index gained 1.1% yesterday. The S&P MidCap 400 finished a close second, as it posted a 1.0% gain on the session. The Nasdaq, the S&P 500 and the Dow Jones Industrial average rallied by 0.7%, 0.6% and 0.4% respectively.

Turnover fell sharply on Friday. Volume fell by 18% on the Nasdaq and 7% on the NYSE. However, Advancing volume finished the day higher than declining volume by a factor of 2.6 to 1 on the NYSE and 1.6 to 1 on the Nasdaq.

GDX hit its tight stop on Friday and we exited the position. GDX is still exhibiting the characteristics of a good short candidate and we may very well reenter the trade if a setup presents itself.

In the February 3rd newsletter we commented, “The Global X Uranium ETF (URA) broke out on massive volume two days ago (02/01/11). A pullback/undercut of the 20-period EMA ($21.50-$21.75 range) on the hourly chart below may provide a long entry trigger for this ETF. We will be following it closely for a possible entry”. Since then, URA has pulled back and undercut the 20-period EMA on the hourly chart. A move back above $21.70 may present a buy entry for this ETF. We are placing URA on the watchlist. Trade details are available for our subscribing members in the watchlist segment of the newsletter.

Hourly chart from February 3rd newsletter:

The Market Vectors Gaming ETF (BJK) has been consolidating since mid January above support at $31.80. A volume assisted rally above $32.50 may present a buy trigger for this ETF.

The DB Gold Double Short ETN (DZZ) has been consolidating along its 50-day MA after pulling back from a big breakout move. A rally back above $8.75 could present a buying opportunity for this ETF.

Although divergence continues among various ETF groups, the broad market appears to have repaired itself quite a bit over the past several trading sessions. Most of our short term technical signals point to another move up for the market.

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Today’s Watchlist:

URA
Long

Shares = 500
Trigger = 21.76
Stop = 21.07
Target = New High (will send alert)
Dividend Date = n/a

Notes = see commentary above

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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:

• GDX short position triggered its stop and we are out with a small loss.
• 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