--> (XOP), (GLD), (IAU) and (PPH) Possible Long Candidates

(XOP), (GLD), (IAU) and (PPH) Possible Long Candidates

ETFs and market commentary:

Stocks slid modestly on Monday on very light trade. All five major indices finished lower, but barely. The major indices chopped in a tight range for the entire day and eventually closed just below session highs. The small-cap Russell 2000 fell 0.3%, while the Nasdaq, DJIA and S&P MidCap 400 shed 0.1%. The S&P 500 demonstrated the most relative strength yesterday as it closed fractionally lower. The gold, oil, utilities, healthcare and transportation sectors all struggled yesterday, while solar energy, biotechnology, oil services and networking outperformed.

Market internals were mixed on Monday as volume plummeted. on the Nasdaq, trade fell by 22.0% and on the NYSE it dropped 23.6%. Declining volume upped advancing volume by 1.1 to 1 on the NYSE and 1.2 to 1 on the Nasdaq. Monday would be considered a consolidation day for the broad market, as volume dropped and price action tightened.

Yesterday, on a pickup in volume, the SPDR S&P Oil & Gas Exploration ETF (XOP) rallied to close near session highs and within striking distance of key resistance. If XOP can rally above resistance of the January 26, 2011 high of $57.32, it could provide an excellent buying opportunity. We are monitoring this ETF carefully for a possible long entry.

Since its big breakout move on January 25, 2011, the iShares Gold Trust (IAU) found resistance near $17.20 and has now pulled back near support of its 20-day EMA and uptrend line. When gold broke out two weeks ago, we received quite a few emails inquiring whether or not gold offered a buying opportunity. At that time, we stated that it was probably not the time to enter the precious metal because the trade was too extended. However, we also stated that gold may offer a buying opportunity on a pullback. Now that gold is pulling back, an undercut of the 20-day EMA could provide a possible buy entry point for IAU. However, an undercut is not a trade setup. In order for IAU to provide a buying opportunity, it must first show some sign of stabilizing from this pullback (ie. basing action and the formation of a reversal candle). Entering an ETF simply because it approaches or touches a key support level is not advisable as there is no way to know whether or not the uptrend will resume. Trade setups are what make a trade legitimate. We will be monitoring IAU closely for a possible long entry trigger.

Both IYT and DVY performed well yesterday as both maintained support at the 20-day EMA on the 60-minute chart. Following a breakout, we will often consult the 60-minute charts as a means of determining the strength of an ETF when it pulls back. As long as the price action on the 60-minute chart remains strong, there’s generally little to worry about. Yesterday’s broad market price action was ideal following Friday’s bullish surge. Distribution days have been virtually nonexistent since late December of last year. At least for the moment, it appears as if the market is determined to continue the move higher.

 

ETFs and market commentary:

PPH
Long

Shares = 300
Trigger = 74.04
Stop = 72.22
Target = new swing high
Dividend Date = n/a

Notes = We’ve been monitoring this trade for potential entry and it remains on our watchlist.

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 DailySubscriber Guide for important, automatic rules on trigger and stop prices

position summary

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Notes:

  • No trades were made. 
  • 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.

Stocks:

Our market timing model remains in buy mode, as we continue to see breakouts working with very little distribution in the market.

The OPK Full-Serve setup is looking good:

 

We added MNST and CELG to the Full-Serve watchlist. See details below.


 

Daily Stock Summary

Below is an overview of all “full-serve” open positions, as well as a performance report on all “full-serve” positions that were closed only since the previous day’s newsletter. Net P/L figures are based on the $50,000 model account size. Changes to open positions since the previous report are listed in red text below.

Having trouble seeing the position summary graphic above? Click here to view it directly on your Internet browser instead.

Notes:

  • JAZZ buy entry to add 50 shares triggered. JAZZ is listed twice in the open positions section due to the separate stops.
  • Per intraday alert, we sold TDG to lock in gains ahead of earnings. We also sold NUAN due to the lack of follow through from our entry heading into earnings.

Relative Strength Watchlist:

The Relative Strength (or RS) Watchlist makes it easy for subscribers to import data into their own scanning software, such as Tradestation, Interactive Brokers, and TC2000. The list is comprised of the strongest 100 (or so) stocks in the market over the past six to 12 months. The scan is based on the following criteria and is updated every Monday:

  • Stock is in a well defined uptrend, trading above both the 50-day and 200-day moving averages, with the 50-day moving average above the 200-day moving average (both moving averages should be in an uptrend as well).
  • Today’s close is less than 20% off the 52-week high
  • Close is greater than $5.
  • Volume is greater than 200,000 shares per day (using a 50-day volume moving average).

Click here to view this week’s Relative Strength Watchlist in excel

Click here to view this week’s Relative Strength Watchlist as a text file

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