Stocks ended the session mixed Tuesday after surrendering early gains. The tech-rich Nasdaq slid 0.5% after trading in positive territory early in the session. The small-cap Russell 2000 also had issues finding a bid, as it fell 0.3% on the day. The Dow Jones Industrial Average, S&P 500 and S&P MidCap 400 tacked on small gains of 0.3% 0.2% and 0.1% respectively.

Market internals also ended the session mixed. Volume was fractionally higher on the Nasdaq but fell just over 4.0% on the NYSE. Declining volume edged out advancing volume on both exchanges. By the closing bell the ratio of declining volume to advancing volume stood at 1.1 to 1 on the NYSE and 1.3 to 1 on the Nasdaq. Market internals were unimpressive and point to a lack of institutional participation in the day's action.

Yesterday, via intraday alert, we provided an alternative short entry trigger for QQQ. The initial trade details for QQQ provided in yesterday's newsletter remain valid. However, we have added an alternative short entry setup for QQQ in the event the market is unable to rally above current levels. Whichever setup triggers first is the valid setup. Both sets of trade details are available to our clients in the watchlist segment of the newsletter.



Since breaking above its 50-day MA on November 21, the ProShares Short MSCI Emerging Markets ETF (EUM) has pulled back into support of this key moving average. Yesterday, EUM formed a distinct reversal candle as it undercut its 50-day MA but reversed to close above this key mark near session highs. A move above the two-day high of $34.60 could present a buying opportunity in this inverse ETF. We are placing EUM on the watchlist. Trade details are available to our subscribers in the watchlist segment of the newsletter.



New trade setups are slowly beginning to emerge as the market has bounced and stabilized over the past two sessions. If the market is able to hold up and rally for another day or two, then many new trading opportunities should begin to emerge.

Deron Wagner is the Founder and Head Trader of both Morpheus Capital LP, a U.S. hedge fund, and MorpheusTrading.com, a trader education firm.