Throughout the first half of yesterday’s session, it looked as though the bears were finally going to have a day in the sun, but the bulls flexed their resilient muscles, enabling stocks to recover and close with mixed results. The Dow Jones Industrial Average edged 0.2% higher and the S&P 500 was unchanged. After falling nearly 1% in the morning, the Nasdaq Composite reversed to close only 0.2% lower. The S&P and Dow finished near their highs of the day, as the Nasdaq settled in the upper quarter of its intraday range.
Turnover eased across the board, enabling the Nasdaq to dodge a bearish “distribution day.” Total volume in the NYSE was anemic, limping in 36% lighter than the previous day’s level. Volume in the Nasdaq decreased 6%. In both exchanges, volume remained below 50-day average levels for the third straight day. Market internals were negative, but not by a wide margin. In both exchanges, declining volume outpaced advancing volume by a margin of less than 3 to 2.
Today, all eyes will be on the latest announcement on federal economic policy, scheduled to be reported by the Federal Open Market Committee (FOMC) at 2:15 pm EDT. While no change in the Fed Funds Rate is expected, Wall Street will be paying close attention to whether or not the Fed drops the verbage of keeping interest rates low for an “extended period” of time. Though there’s been a bit of volatility, stocks have been little changed for the past two days, and volume has been light. Trader and investors have apparently been standing on the sidelines, but the release of this afternoon’s announcement should provide the market with more direction. For now, we remain primarily in pullback buying mode, stalking strong ETFs for potential buy entry as they retrace to key support levels. Below are the charts of a few ETFs on our radar screen for potential buy entry in the near-term:
In addition to the setups above, we continue to monitor KBW Capital Markets SPDR (KCE) for a pullback to add additional shares to our existing position, as illustrated in yesterday’s commentary. A bounce in CurrencyShares Euro Trust (FXE), into major resistance of its 50-day MA, also remains on our radar screen for potential short entry. If any of the ETFs above meet our criteria for buy entry, we’ll promptly send an Intraday Trade Alert with details.
There are no new setups in the pre-market today, as we typically avoid entering new positions ahead of FOMC meetings. Nevertheless, if any ETFs on our radar screen trigger for entry, we’ll promptly send an Intraday Trade Alert with details.
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 changes to open positions at this time.
- 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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Edited by Deron Wagner,
MTG Founder and Head Trader