We continue to see strength in top ETFs and stocks, with solid participation among many sectors. While the financials and homebuilders have slowed down a bit, there is certainly enough leadership left to push the market higher for a few months.

One such ETF showing strength is PowerShares Dynamic Media ($PBS), which has recently broken out from a tight-ranged consolidation at the highs.

Volume also picked up on the breakout to new highs last week, which is a bullish sign. Note this ETF is NOT a buy candidate for us right now, but we are simply pointing out strength in the market.



Today, we also return to the chart of iShares MSCI Japan ($EWJ) because we are placing $EWJ on our "Watchlist" as an official buy setup. Take a look:



After breaking the downtrend line of its price consolidation, the price of $EWJ is now sitting on top of all the major averages, just below resistance of the July mid-point at $12.20.

The moving averages are finally in order, with the 20-day EMA (in beige) now trending higher for the past few weeks AND above the 50-day MA (blue). The 50-day MA is also sloping slightly higher, and the 200-day MA (orange) remains in a clear uptrend. Paid subscribers of The Wagner Daily should note our exact entry, stop, and target prices for this swing trade setup.

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.