In Brief
At this point in time, the main components for biotech IBB, are listed here.
Note that ‘chief cook and bottle washer’ Moderna, is No. 5, on that list.
IBB’s closing price action shows a repeating set-up.
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
Once You See It.
Legend has it, Wyckoff locked himself in a room with nothing but a stock ticker and telephone; working many hours to decipher what the tape was telling him.
Later, the result of that effort was presented in his seminal text, Studies In Tape Reading, first published in 1910.
One of, if not the most important concept of that effort (also in his training materials) was, ‘What’s the market saying about itself?’
We’re going to use that idea to look at the biotech sector and specifically XBI.
Biotech XBI, Daily
There it is:
We have at least three significant thrusts lower; four if you count the one on August 28th, all of which suggest that XBI is in ‘distribution’ (not advice, not a recommendation).
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
Meets the Definition
We just had a reminder days ago, from Linda Raschke, about the definition of a price action ‘trend’.
For a downtrend, it’s lower lows and lower highs.
When looking at biotech XBI, that’s what we have; a downtrend (not advice, not a recommendation).
Biotech XBI, Daily
At this point, we’re between ‘spring’ and ‘resistance’.
We see the Fibonacci sequence comes and goes; next up is ‘Day 55’.
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
From Resistance To Wedge … and Back?
The last update on Moderna, here, said that price action had slammed into resistance.
The chart shows that MRNA, has gone from resistance. to wedge, to measured move.
With the S&P and Qs, stalled at all-time highs, SOXX, DIA, XLF, IYR well off their highs with the biotech sector in an apparent reversal, one has to wonder what’s next (not advice, not a recommendation).
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
The Really Big Picture
One of the few indices or sectors that has not made new all-time highs, is Biotech XBI.
In the case at left, XBI spent an entire quarter pinned against resistance, going nowhere.
Now, in the first week or so of the current quarter, XBI is edging away from the highs (not advice, not a recommendation).
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
At The Edge of Trend
We’re looking at biotech XBI, from the perspective of the 3X Leveraged Inverse Fund, LABD.
During the past four trading days, there have been three contact (verification) points on the right-most trendline.
Note that five trading days ago, LABD had its highest volume day, ever.
Trade Note:
The XBI-26-17 (short) was exited at about break-even, then re-positioned via LABD, as LABD-26-18 (not advice, not a recommendation).
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
‘There’, is a new All-Time High
Two weeks ago, was this update showing the (net) upward progress of the S&P was slowing (not advice, not a recommendation).
Then, two days later was this, presenting how the index might make it to another high.
Now, the SPY chart is mimicking the longer timeframe by having successive shorter thrusts (magenta arrows).
At this point it’s a toss-up but does it really matter?
Meaning, if the downside is being worked (shorted), large numbers of tickers are already in essentially free-fall: AZO, BKNG, DUOL, HD, KMX, LOW; way below their all-time highs (not advice, not a recommendation).
Note: All have been covered at some point, on this site.
One sector that’s not cracked (yet) but seems to be building up immense pressure, is biotech.
Barring any unforeseen event, XBI is covered next.
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
Subdividing Lower
Looking at the chart from left-to-right, the peaks are lower and the lows, are lower.
As noted, today was an apparent up-thrust (reversal), with a test coming towards the close.
After-hours action (as of 7:40 p.m., EST) is holding steady; no movement up or down.
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
Underside Test
The chart segment of XBI shows its posted an axis line over the past few months.
There have been oscillations on both sides, with today being an underside test.
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
And Then?
Fibonacci ‘Day 21’, was a swift wide bar down move.
Wide bars tend to get tested, and we see that happening today and possibly tomorrow (not advice, not a recommendation).
When looking at the left side of the chart (compared to right), volatility has increased, indicating instability.
Stay Tuned
Charts by StockCharts, TC2000
The Danger Point®, trade mark: No. 6,505,279
