Category Archives: LABD-22-14

Downside Kick-Off … and, Biotech

December 22, 2022 By in $SPSIBI, Biotech, Catherine Austin Fitts, Greg Hunter, IWM, LABD, LABD-22-14, Positions, Russell 2000, Stew Peters, TZA, TZA-22-02

Biotech, And The Next ‘Event’

Now, it all makes sense.

The solstice was yesterday.

Hard reversal in the market, today.

Then, there’s biotech; stubbornly refusing to break down.

First, Some Housekeeping

Before we go any further, from a housekeeping standpoint, all biotech short positions have been closed (not advice, not a recommendation).

Each apparent downside breakout attempt for the past three months, has been thwarted. There is something else going on.

Possible reasons for biotech’s resilience can be found here, and here and here.

Hint: There’s another planned ‘event’, on the way.

Now, back to the markets.

All major indices are sharply lower but for this update, we’ll focus on the Small Caps (Russell).

Russell 2000 IWM, Daily

Instead of starting with the big picture and longer timeframes, we’ll get straight into why today’s action may be significant.

Yesterday, price action attempted to ‘spring’ off the support boundary. Today, that spring has apparently failed.

Failed moves bring out the other side in force; in this case, the bears as it’s obvious the opposing side, the bulls, are exhausted.

It’s getting late in the session (2:50 p.m., EST) and the expectation is for a lower close.

If this really is the kick-off to the downside, then we’ll expect some kind of follow through at the next session.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Gold … Now, Comes Deflation

December 13, 2022 By in 1929, Biotech, GLD, LABD, LABD-22-14, Michael Cowan, SPBIO, Uneducated Economist, ZeroHedge 3 Comments

The ‘Pivot’, No One Expects

Happy days are here, again!

So, the Fed can pivot, and the bull’s on again.

At least, that’s what the media wants us to believe. The CPI is out, and ‘inflation’ has slowed.

The problem is, as Michael Cowan stated in this update (he’s done the work), from here, it does not matter what the Fed does.

The decline (crash) or whatever you want to call it, is baked in the cake.

Once deflationary forces start, it becomes a juggernaut.

The previous update on gold (GLD) showed in multiple time frames, upward thrust energy is dissipating; in at least one case, (weekly) it’s also divergent.

Now that we’ve had yet another blip higher, as expected, it’s rabid bullishness in the gold camp.

So, let’s look at what GLD, is actually doing. What does the market say about itself?

Gold (GLD), Daily

One thing is for sure; GLD, is at The Danger Point®

If GLD can’t hold above (and move above) this level, it may be in serious trouble.

Let’s look at it a different way … the terminating wedge.

A ‘wedge’ is typically the last pattern in a move up or down, hence the name.

As this post is being created (12:23 p.m., EST), GLD continues to decline from its open; currently sitting right at the resistance (potential support) level at the 168-area.

In a separate market, biotech SPBIO, has completely reversed its opening spike and is now posting lower.

We’re still maintaining the LABD-22-14 trade (not advice, not a recommendation).

Today’s CPI print and resulting price action, may be the kick-off to an overall sustained and persistent decline.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Biotech … Breakdown, Imminent

December 9, 2022 By in $SPSIBI, Biotech, CVNA, Elliott Wave, LABD, LABD-22-14, Positions, Prechter, SPBIO

Waiting For A New Daily Low

Price action leads the news.

As with the Carvana analysis, a year ago which said CVNA, would likely not survive, so too it would appear, biotech is about to join the ranks.

Join the ranks but for different reasons.

Price action leading the news was a concept presented decades ago by Robert Prechter Jr., as part of his Elliott Wave Theory.

His view was the market indicates ‘social mood’; in that case, the market must go down first, before the bad news comes out.

In effect, the public has to be ready and actually want bad news and/or be ready for unexpected, cataclysmic events.

It’s the complete opposite of the accepted mantra, from financial advisors and media alike.

The bear flag in biotech SPBIO, has been forming now for three months. In the history of this sector, there’s never been anything like it.

The last update said there’s been a change in the character of price action; that SPBIO, is heading lower and about to threaten the bottom of the flag.

As we’ll see from the daily chart, indeed we’re getting close.

At this point, there’s no apparent demand for the upside.

Biotech SPBIO, Daily

The change in character is clear. We’re pulling away from the top of the flag and now, hovering at the lows.

Switching gears and going to the 3X leveraged inverse fund LABD, on the daily basis, we see repeating trend lines.

SPBIO, 3X Leveraged Inverse LABD, Daily

As the magenta arrow shows, we’re looking for a new daily high in LABD, to confirm the trendline; that high would naturally correspond to a new daily low in SPBIO.

As of this post (1:02 p.m., EST) neither one has occurred.

Summary

Even as the overall markets are mixed to slightly higher, SPBIO, is posting down – 1.51%; a possible indication it may lead to the downside.

Just exactly what ‘news’ is about to come out is unknown.

However, at this juncture with action pressing lower, it appears, the market is ready.

Positioning

Not advice, not a recommendation.

LABD-22-14

Entry@ 18.905, 18.95*** Stop @ 18.36***

Note: Positions may be increased, decreased, entered, or exited at any time.

***, Indicates change

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Biotech … Bear Flag, Break ?

December 6, 2022 By in $SPSIBI, Biotech, DRV, DRV-22-06, IYR, LABD, LABD-22-14, Positions, Real Estate, SPBIO 1 Comment

The Character Has Changed

It’s been more than frustrating attempting to short biotech.

So far this year there’ve been thirteen attempts; some successful, but most were not.

None of the attempts have captured the ‘big move’ that’s overdue for this market.

The last post essentially gave up on biotech, but it seems like the potential just won’t go away.

This time, over the past two days, the character of price action has changed.

Re-capping briefly, biotech SPBIO, has been in a bear flag for over two months.

During that time, it’s been oscillating and coiling; looking for a breakout to the downside.

As of this post, there’s no breakout yet but we’re heading to the bottom of the flag, with a change of character.

SPBIO, Weekly

It’s important to note, the pattern below, is unique.

The sector data goes way back to April of 2009. During its trading history SPBIO, has never posted a bear flag with a two-plus month duration.

An expanded version of the chart is below:

Now, comes the interesting part.

Going to the hourly, we have a trend line and a breakdown of intermediate support in the SPBIO 6,390-area.

This is the change of character.

SPBIO, Hourly

Note that we’re deep within the bear flag and at the right edge of price action.

We’ve got the trendline as shown.

Price action during yesterday’s session, contacted that line six consecutive times.

As of this post (12:50 p.m., EST), price continues lower.

Summary

So, is this ‘the big one’?

The correct answer is that it’s unknown.

What we do know however, just by looking at what the market is saying about itself; there’s been a change, at least in the past two days.

Price action’s breaking through support levels and heading for the bear flag lows in the vicinity of SPBIO 6,125.

A reasonable expectation is for some kind of a bounce if or when it hits this area.

Positioning

Not advice, not a recommendation.

DRV-22-06: Closed***

Gain + 5.61%

Re-opened biotech SPBIO Short (not advice, not a recommendation)

LABD-22-14***

Entry@ 18.905*** Stop @ 18.39***

Note: Positions may be increased, decreased, entered, or exited at any time.

***, Indicates change

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279