Continuing to pull back from their recent highs, the major indices sustained a significant round of losses yesterday, but turnover continued to decline. Stocks gapped lower on the open, then drifted sideways to lower throughout the remainder of the day. The Nasdaq Composite shed 2.8%, the S&P 500 2.4%, and the Dow Jones Industrial Average 2.3%. The small-cap Russell 2000 and S&P Midcap 400 indices lost 3.5% and 3.3% respectively. Opposite of Monday's losing session, this time the main stock market indexes closed near their intraday lows.

One encouraging aspect of yesterday's action was that volume continued to recede. Total volume in the NYSE was 3% lighter than the previous day's level, while volume in the Nasdaq ticked 7% lower. Yesterday was the third straight day of declining volume, two of which were "down" days. This tells us the bulls have been taking a rest, but the bears have not shown an interest in reclaiming control. Nevertheless, market internals worsened. In both the NYSE and Nasdaq, declining volume exceeded advancing volume by a margin of just over 5 to 1.

Yesterday, we illustrated that SPDR Gold Trust (GLD) had sold off to fall below a key level of horizontal price support, but closed at even more important support of its 200-day moving average. Following a similar pattern as gold, iShares Silver Trust (SLV) has also sold off over the past several weeks. But even as gold and silver have been dropping, E-Tracs Platinum (PTM) is one precious metal ETF bucking the trend. Take a look:

The pink rectangle on the chart above marks the short-term base of consolidation PTM has been forming in recent weeks. As it has been trading sideways, the 20-day exponential moving average (the beige line) has been rising up to meet the price of PTM. The 50-day MA (the teal line) has cleanly been trending higher, well below the 20-day EMA. As a potential buy setup, PTM can be bought on a breakout above the March 19 high of $14.38. However, note that the 200-day MA (presently at $14.71) may provide resistance. Still, even if the breakout above consolidation has trouble following through because of the 200-day MA, one can simply scratch or close the trade for a small gain.

So far, there's been no indication the broad market's rally off the March lows, a substantial, counter-trend bounce within a long-term bear market, is finished. Despite the losses of the past two days, the major indices remain in short and intermediate-term uptrends. All the main stock market indexes are still above their 20-day exponential moving averages, which have crossed up through the 50-day moving averages (a bullish intermediate-term signal). Nevertheless, now is probably not the most ideal time to enter new positions. In case you missed yesterday's closing commentary, it bears repeating. . .

"There are two reasons it may be a good idea to lay low throughout the rest of the week, focusing on managing existing positions, rather than entering new ones. First, quarterly corporate earnings season officially kicks off today...There's been a lot of speculation over the past several months as to how the next corporate earnings period would fare, but pure speculation is all it's been. As such, it's likely the stock market will be rather jittery and indecisive as investors and traders await and subsequently digest earnings reports from key, market-moving companies. Second, the market is closed for Good Friday holiday on April 10. As is the case with all three-day weekends, volume will probably be lighter than average ahead of the holiday. Light volume mixed with possible earnings jitters is a perfect recipe for whippy market action, the kind that will churn your trading account if you're not careful. To compensate, you might consider keeping your stops wide enough to provide your positions with substantial "wiggle room" for the rest of the week."

Open positions (coming into today):


UGA long (175 shares from March 4 entry) - bought 23.41, stop 22.61, target 31.30, unrealized points = + 1.51, unrealized P/L = + $264

HHH long (200 shares from March 23 entry) - bought 35.25, stop 32.49, target 41.80, unrealized points = + 1.05, unrealized P/L = + $210

TAN long (500 shares from March 31 entry) - bought 7.05, stop 5.88, target 9.75, unrealized points = + 0.08, unrealized P/L = + $40

ERX long (150 shares from April 1 entry) - bought 24.52, stop 20.40, target 39.90, unrealized points = + 0.03, unrealized P/L = + $5

USO long (150 shares from March 17 entry) - bought 29.08, stop 27.66, target 38.70, unrealized points = (0.14), unrealized P/L = ($21)

UDN long (700 shares from March 25 entry) - bought 25.70, stop 24.84, target 27.45, unrealized points = (0.42), unrealized P/L = ($294)

SLV long (400 shares from March 5 entry) - bought 13.14, stop 11.71, target 16.35, unrealized points = (1.07), unrealized P/L = ($428)


Closed positions (since last report):


(none)


Current equity exposure ($100,000 max. buying power):


$45,734

Notes:


• The market is in pullback mode, but we plan to hold our positions in anticipation of catching the next leg up in the market. Our stops should be loose enough to allow this to happen.
  
  
• 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.
  
  
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