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Deron Wagner is the founder and portfolio manager of Morpheus Trading Group. His daily focus is managing and trading the Morpheus Capital Hedge Fund, which he founded in April of 2004. He also teaches his swing trading strategy with The Wagner Daily newsletter, which provides exact entry, exit,... More
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Advanced Technical Analysis of ETFs
  • Potential reversal action in "YCS" - November 10, 2010 0 comments
    Nov 10, 2010 9:01 AM | about stocks: YCS
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    The Wagner Daily - November 10, 2010
    Concise technical analysis and picks of the leading global ETFs



    Commentary:

    Tuesday's trading saw the first significant slide in the major indices in almost two weeks. Small-cap and mid-cap stocks led the day's decline. The small-cap Russell 2000 shed 1.5% and the S&P MidCap 400 slid 1.1%. The S&P 500, Nasdaq and Dow Jones Industrial Average posted losses of 0.9%, 0.7% and 0.5% respectively. The major averages moved in a choppy range for the first 90 minutes of trading. At the 11:00 am reversal period the markets sold off sharply the majority of the day. The market did manage to pare some of its losses, as it bounced into the close.

    Volume spiked significantly on Tuesday. Turnover on both the NYSE and the Nasdaq skyrocketed in Tuesday's session. Volume was up 22% on both the NYSE and the Nasdaq. On the NYSE, declining volume outpaced advancing volume by 4.2 to 1, while the saw declining volume beat advancing volume by a ratio of 2.2 to 1. Tuesday's market internals suggest Institutional distribution.

    As discussed in Tuesday's newsletter, the Japanese Yen was showing signs of weakness. In Tuesday's trading session, the CurrencyShares Japanese Yen Trust (NYSEARCA:FXY) formed a significantly bearish reversal candle and plummeted below the 20-day EMA. In a single day of trading FXY dropped and closed below the September 19th low. The selloff was accompanied by a big spike in volume. The inverse of FXY demonstrated a mirror pattern. The ProShares Ultra Short Yen (NYSEARCA:YCS), blasted through resistance on Tuesday on massive volume. It closed well above the 20-day EMA. In the November 8th newsletter, we used the YCS chart to provide an example of a reversal setup. It was a timely example. Although YCS is not officially on the watchlist, we will be monitoring it closely for a possible buy entry. We will send out an alert should we enter the trade.






    The commentary above is an abbreviated version of our daily ETF trading newsletter, The Wagner Daily. Subscribers to the full version receive specific ETF trade setups with detailed trigger, stop, and target prices, as well as daily updates on all open positions. Intraday Trade Alerts are also sent via e-mail and/or text message, on as-needed basis. For your free 1-month trial to the full version of The Wagner Daily, or to learn about our other services, please visit morpheustrading.com.

    Deron Wagner is the Founder and Head Portfolio Manager of Morpheus Trading Group, a capital management and trader education firm launched in 2001. Wagner is the author of the best-selling book, Trading ETFs: Gaining An Edge With Technical Analysis (Bloomberg Press, August 2008), and also appears in the popular DVD video, Sector Trading Strategies (Marketplace Books, June 2002). He is also co-author of both The Long-Term Day Trader (Career Press, April 2000) and The After-Hours Trader (McGraw Hill, August 2000). Past television appearances include CNBC, ABC, and Yahoo! FinanceVision. Wagner is a frequent guest speaker at various trading and financial conferences around the world, and can be reached by sending e-mail to: deron@morpheustrading.com.



    DISCLAIMER: There is a risk for substantial losses trading securities and commodities. This material is for information purposes only and should not be construed as an offer or solicitation of an offer to buy or sell any securities. Morpheus Trading, LLC (hereinafter "The Company") is not a licensed broker, broker-dealer, market maker, investment banker, investment advisor, analyst or underwriter. This discussion contains forward-looking statements that involve risks and uncertainties. A stock's actual results could differ materially from descriptions given. The companies discussed in this report have not approved any statements made by The Company. Please consult a broker or financial planner before purchasing or selling any securities discussed in The Wagner Daily (hereinafter "The Newsletter"). The Company has not been compensated by any of the companies listed herein, or by their affiliates, agents, officers or employees for the preparation and distribution of any materials in The Newsletter. The Company and/or its affiliates, officers, directors and employees may or may not buy, sell or have positions in the securities discussed in The Newsletter and may profit in the event the shares of the companies discussed in The Newsletter rise or fall in value. Past performance never guarantees future results.

    Charts created by TradeStation (tradestation.com).

    © 2002-2010 Morpheus Trading, LLC
    Reproduction without permission is strictly prohibited.
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