Commentary:
Stocks closed modestly higher on Thursday on mixed trade. All five major indices ended up on the day. The S&P MidCap 400 led the way, as it rose by 0.8%. The Nasdaq tacked on 0.7%, while the S&P 500 finished up by 0.5%. Both the DJIA and the small-cap Russell 2000 tacked on 0.4%. Yesterday marked the ninth time in ten sessions that the Nasdaq has closed higher. Sectors showing relative strength were retail, semiconductors, financials, emerging markets and networking. Precious metals, oil, natural gas and utilities lagged on the day.
Internals were mixed. Volume dipped on the Nasdaq by 1.0%, while on the NYSE it finished higher by 1.2%. Advancing volume topped declining volume across the board. The ration of up volume to down volume ended the day at 1.9 to 1 on the NYSE and at 1.7 to 1 on the Nasdaq.
Yesterday, via an intraday alert we entered a long position in the Direxion Daily Gold Miners Fund (DUST) as it rallied above the two day high ($38.50) on the highest volume it has seen in 13 sessions. On January 17th, DUST formed a long reversal candle, as it undercut the 50-day MA and then rallied to close near session highs just below resistance of the 20-day EMA and the 200-day MA. Then on January 18th, DUST formed an inside candle as it trade near the January 17th highs in a tight range. Trade details are available to our members in the open positions segment of the newsletter.
The ProShares UltraShort EURO Fund (EUO) has been in an uptrend since early November and has exhibited relative strength to the broad market during this time. Over the past three days, EUO has gapped down three consecutive times and is now just below support of its uptrend line and the 20-day EMA. If EUO can stabilize and form a reversal candle at its current level, it could provide a long opportunity. Ideally, we would like to see a reversal candle formed, followed by several days of sideways action. We are monitoring EUO closely for a possible long entry.
We exited two trades yesterday to lock in profits. We sold both TNA and IXN into strength. Since the market has been up for quite a few days, we felt it was wise to lock in some solid gains. As mentioned, we purchased DUST and are currently up over 3.0% in this trade. Although most of the major indices closed near session highs, there seemed to be some selling pressure that entered the market late in the day. After hours, Google reported a miss of both revenues and earnings, sending the stock into a tailspin. Google was down almost $60.00 after the close. We wouldn’t be surprised to see the Nasdaq fall under further pressure at the open. A day or two of modest selling would actually be good for the market, as several of our momentum indicators are beginning to suggest the market may be overbought in the near term.
Today’s Watchlist:
There are no new official setups for today. As always, we will send an intraday alert if any new trades are made.
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 $50,000Wagner 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:
- Per intraday alert, sold IXN and TNA to lock in gains. We also established a short position by going long the Gold Miners Bear 3x ETF DUST.
- 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’sWagner 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.
Edited by Deron Wagner,
MTG Founder and Head Trader