Category Archives: LABD

Biotech … The ‘Short’ List

May 11, 2023 By in Biotech, LABD, SPBIO, Great Depression, $SPSIBI, The List

A Long List, At That

The prior analysis of biotech SPBIO, had expectations for price action to rise into the 6,400 area: the location of the 200-Day Moving Average.

It did that, and more …

Back in late April, SPBIO, was in a Fibonacci time sequence. Shown below, that time structure may still be intact.

But First … The List

Note: This is not “The List“, as has been compiled (still on-going), covering the horrors of this sector but rather a list of reasons why SPBIO, is likely to head lower from here.

Here it is, not in any particular order:

Price action has reached a Fibonacci 76.4%, level

From the March 24th low, price action has retraced upward in an ‘a-b-c’ corrective move, with wave ‘a’ distance equal to wave ‘c’. Note: Equal distance ‘a’ and ‘c’, on a print basis.

At the last session, as the action pushed to a new daily high, there was ‘evidence of a struggle’ during the session to either reverse lower or move higher. Action was undecided and closed slightly below the open.

Looking at the first chart below, the daily close for the past three-years has the trend decidedly down; this sector is the weakest of all the major indices.

On the chart below, there’s a series of lower highs, lower lows that have oscillated into a massive bearish wedge.

Yesterday (Wednesday) was a Fibonacci 34 days (-1), from the print lows set on March 24th. That day was also a Fibonacci 34 days (+1), from the closing low set on March 22nd. We’re still posting a Fibonacci Time correlation.

From the highs set on February 2nd, to the lows on March 24th and then to the highs set yesterday May 10th, is symmetrical; separated by a Fibonacci 8-weeks lower and then Fibonacci 8-weeks higher.

Fundamentally, this sector is a disaster. None of the top ten equities have a P/E. All are losing money.

No P/E and operating at a loss; interest rates rising, credit standards being tightened. How are these outfits going to secure more Venture Capital (or any additional funding via stock/debt) in that environment; implosion is dead-ahead (not advice, not a recommendation).

Bank failures continue … at some point (as with the rest of us) one of these banks may be the line of credit for company payroll. Not all banks went bust in The Great Depression but just enough to halt payroll for some key industries. That event helped topple the economy.

The list goes on but that’s enough to make the point.

Now, on to the charts.

Biotech SPBIO, Daily Close

Moving closer in, to show the Fibonacci retrace, the Fibonacci time and the ‘a-b-c’ structure.

As of this post (12:25 p.m., EST) price action continues its downside reversal.

Because the retrace level (76.4%) is the highest noted by Fibonacci, we can expect some amount of upward testing if there’s going to be a sustained downside.

Anything can happen. However, with the above list compiled for both technical and fundamental conditions, probabilities point lower (not advice, not a recommendation).

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

Short Squeeze … Biotech

April 28, 2023 By in Biotech, LABD, Wyckoff, $SPSIBI 1 Comment

Running The Stops

It looks like we’re in a squeeze with price action screaming higher.

As shown in the last update, the LABD hard stop was @ 16.79 (not advice, not a recommendation).

With that said, the entire short position was exited at 16.7501, early in the session.

Overall gain was around 3.96%

With the housekeeping out of the way, let’s move on to the chart and see where price action’s likely to head next.

Biotech SPBIO, Daily

We’ll get right to the point and show the most likely area to clear out stops and potentially set up for the next reversal.

The moving averages have been left in the chart (not a usual practice) because that’s the focus of the crowd.

In their minds, a close above the 200-Day MA, would be bullish.

If that happens, from a Wyckoff standpoint, we could be in up-thrust (reversal) position.

Fibonacci Time

Also of note: When a Fibonacci sequence becomes obvious, that’s when it tends to fall apart or morph into some other type of sequence.

That may be happening now.

Strategy

As always, price action can and will do whatever is necessary to extract as much from both sides (bull, bear) as possible.

It may contact the 200-MA or not. It all depends on where the most stop oerders are hiding.

Slightly above the recent highs looks like a good area for those stops.

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

Narrow ‘Breadth’ … What It Means

April 27, 2023 By in Biotech, S&P 500, S&P, LABD, SPY, ZeroHedge, SPBIO, The Maverick of Wall Street, $SPSIBI, AMZN, AAPL, MSFT 1 Comment

Record Extreme

One report covering the historic narrowing of the market is here.

Never before seen narrow breadth: What does it mean?

It means the market’s ‘keeping up appearances’ while the foundation’s been removed.

That way, the professionals can get out the door; sell or sell-short, funnel capital to the only three tickers left (AAPL, AMZN, MSFT), while the public looks at the SPY, and says ‘Where’s the collapse?’

Let the crowd focus on the S&P … probably the most computer controlled, AI driven, Machiavellian manipulated market in the world … but hey, I’ve got my i-phone trading app and I’m going to ‘Put it to the man’.

Meanwhile, downside leader biotech, inches lower.

Biotech SPBIO, Daily

Let’s review where we are with SPBIO, with the full understanding that anything can happen.

For now, we’re heading lower (not advice, not a recommendation).

It’s obvious. Biotech’s following a Fibonacci time sequence.

Let’s pull out to the larger weekly chart and see something really scary.

Biotech SPBIO, Weekly Close

If we really are at the right side of the trading channel, it’s not looking good for the bulls.

Of course, it all makes sense.

The market’s at record breadth divergence. Banks are collapsing, Ukraine (fabricated, or not) coupled with trade wars, the consumer’s tapped-out (credit at maximum) and on it goes.

Positioning

Early this session, the short position in biotech (via LABD) was increased (not advice, not a recommendation).

The table below shows the trading (entry) activity during the on-going reversal (not advice, not a recommendation).

Hard Stop: 16.79

The notation ‘LABD-23-05’, indicates this is the fifth trading campaign (or trade series) in LABD for the year.

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

‘Mum’s The Word’

April 24, 2023 By in Biotech, LABD, SPBIO, $SPSIBI

No One Talks About It

It’s interesting, but then again not, how this sector (biotech, SPBIO) gets absolutely no mention in the mainstream or on YouTube.

It made all-time highs and reversed down long before the rest of the indices (except the miners); why is it not the focus of financial and technical discussions?

We’ll leave that as an open question for now and move on to the technical condition; that is, the downside pivot may be at hand.

The last update finished with this (emphasis added):

“Taking it all in aggregate, we’re obviously at an extreme and either going to reverse from here or launch into a sustained continuing directional move.“

Well, reversal it is.

This update will be brief, showing the current state of SPBIO (as of 11:57 a.m., EST) and the Fibonacci time correlation from the February 2nd top.

Biotech SPBIO, Daily

For the engineers out there, the ‘exactness’ (i.e., posting extremes to the day) is not important.

What is important is to recognize the structure.

That is at this point, price action’s adhering to a Fibonacci time sequence.

Good News, Bad News

The good news is, anyone short this sector (via LABD) is now green for the day (not advice, not a recommendation).

The bad news is, this market may once again be the downside leader. We’ve already done the work on projecting target areas.

If those projections come to pass, it’s going to be a very different world. At that point, this sector may actually be the topic of mainstream and YouTube discussions.

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

Mastering The Reversal … Biotech

April 22, 2023 By in $SPSIBI, Biotech, LABD, SPBIO, Wyckoff 1 Comment

At The Extreme

We’re about to find out if Biotech’s in a new bull market or at the retrace extreme, ready for reversal.

The last update gave us the big picture on the index; a massive H&S pattern, five years in the making.

A potential trendline was shown on the daily chart of inverse fund LABD. That trend was subsequently negated by price action just hours later.

Let’s look at SPBIO, more specifically, the 4-Hour Chart.

To mimic price action of leveraged inverse LABD, we’ll invert the SPBIO.

The reason for inverting, not using LABD, is that leveraged funds have a downward bias which distorts the actual data.

Biotech SPBIO, 4-Hour, Inverted

The chart highlights Point No. 1 and Point No. 2. These areas are identified as a reminder; the prior set-up and reversal was identified, to-the-day.

There’s no guarantee the same performance will be repeated, i.e., spotting the next reversal.

The chart below, shows why we’re at The Danger Point®

Wyckoff discussed a phenomenon he called ‘shortening of the thrust’. When price action’s ready to reverse, the directional thrusts become shorter.

We’ll zoom-in on the recent action to show that Friday’s session failed to post a new daily low (high for non-inverted).

Now new low, may be the reversal nuance or not … we’ll find out at the next open (not advice, not a recommendation).

Not shown on the chart, price action’s retraced a Fibonacci 50%, of the entire move from the set-up and reversal of February 2nd, and 3rd.

Summary

Taking it all in aggregate, we’re obviously at an extreme and either going to reverse from here or launch into a sustained continuing directional move.

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 … Early Stage Reversal

April 21, 2023 By in $SPSIBI, Biotech, LABD, SPBIO, The List, The Speck, ZeroHedge 2 Comments

The ‘Big’ One ?

Sometimes early in a reversal it looks like nothing’s happening.

Only after we’re underway, it’s clear where the pivot occurred.

In our case, biotech SPBIO, broke down out of its bear flag, came back to test and now, may be continuing on its downward track.

The reversal’s not obvious yet and can be easily negated by more upward pressure. We’re at The Danger Point®.

A quick review of the monthly chart shows a potential Head & Shoulders forming.

Biotech SPBIO, Monthly

If that’s what’s happening, the H&S pattern, it’s massive; spanning five-years and counting.

The ‘Fundamentals’

Of course, a massive reversal pattern would coincide with what’s happening overall at this juncture.

It seems that each day, we have more of this:

Twitter Files: Dr. Anthony Fauci “Lied Under Oath”

CDC Director Admits Vaccines Do Not Prevent COVID Transmission, Blames “Evolution Of Science”

Throw in a banking crisis or two, credit tightening, supply disruptions and this sector may collapse under the weight of that all by itself (not advice, not a recommendation).

Moving closer in, on a 3-Day chart we see the break and test more clearly.

Biotech SPBIO, 3-Day

We’ll zoom-in on the trend break.

Lastly, going to the 3X Leveraged Inverse Fund LABD, on the daily timeframe, it shows a repeating trendline that may be in confirmation during this session (currently, 11:15 a.m. EST).

Biotech Leveraged Inverse LABD, Daily

It’s still early in the session and anything can happen.

This is where the risk is least (not advice, not a recommendation).

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

Nat-Gas … New Lows ?

April 20, 2023 By in BOIL, LABD, SPBIO, UNG, Wyckoff 1 Comment

The Tape Is Always Right

The Nat-Gas futures contract for May (NGK23), needs to post above 2.383 soon (in the next day or so), or the contract is at risk of pressing to new lows.

We’ll look at the ETF proxy for nat-gas UNG, below, showing a Wyckoff up-thrust (downside reversal) condition.

As this post is being created (8:51 a.m., EST), the pre-market session shows the futures and UNG, oscillating about unchanged.

Natural Gas UNG, Daily

As with the upside reversal identified in the biotech sector (link here), we’re just reading the tape and acting accordingly (not advice, not a recommendation).

With that said, a trade was executed and closed in leveraged fund BOIL, with the following details:

BOIL Entry: 3.15

BOIL Exit: 3.45

Profit (Loss): 9.52%

The expectation was for a much larger profit.

However, price action is not behaving as if it’s in a strong up-trend. It’s even at risk of posting new lows as a result of the Up-Thrust condition noted above.

Meanwhile, biotech looks like it’s about ready to reverse.

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 … Testing Resistance

April 18, 2023 By in $SPSIBI, LABD, SPBIO, The List, The Speck, Wyckoff, Wyckoff Stock Market Institute

Test & Reverse ?

The Wyckoff ‘spring’ position in biotech was identified correctly.

Two days later, SPBIO launches straight-up.

So, let’s take a look at what’s likely to happen next.

Going way back to 1931 and Wyckoff’s teachings and course material (still available here), he stated:

‘When an up-trend is decisively broken to the downside, more often than not, there’s some type of attempt to rally as a test of that break.’

We’ll use a Fibonacci 3-Day Closing chart of Biotech SPBIO, to see if Wyckoff’s timeless market insight still holds up in today’s world.

Biotech SPBIO 3-Day Close

Starting with an un-marked chart, first.

Putting in the notations with a zoom into the recent action.

Well, it looks like nothing has changed in the last 100-years because there it is. 🙂

Biotech broke down out of its trendline and bear flag of the past five months and has now come back to test that area.

Fundamentals

By this time, we all know the story on this sector. The fundamentals are nothing short of horrific.

Just in case there’s someone new to this site and they’ve not yet got the memo, we’ll add two more to ‘The List‘

Contentious COVID-19 Drugs Are All Anti-Malarial: May Not Be A Coincidence

UK Study Finds “No Evidence” Face Masks Protect Vulnerable Against COVID

As always, it’s the comments from the ‘ZeroHedge Guys’, that are more valuable than the article itself.

Strategy

For my corporate accounts, I’m already re-positioning short via LABD, starting during the last session (not advice, not a recommendation).

The initial entry has been quite small as this market could push a bit higher (lower for LABD) just because of momentum alone.

We see that in today’s pre-market session (LABD down about 2%).

It’s now about five minutes before the open.

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 … Penetrates & Hesitates

April 11, 2023 By in $SPSIBI, LABD, SPBIO, Wyckoff 2 Comments

Price Action, The Last Word

For the bearish case, something’s wrong with price action on biotech SPBIO (not advice, not a recommendation).

As the weekly chart shows, SPBIO has penetrated support and stopped-dead.

Technically speaking, as unbelievable as it may be, we’re in Wyckoff spring position.

Biotech SPBIO, Weekly

Price action penetrates support and hesitates … potentially setting up a rally.

Until there is some indication of downside continuation, all shorts (via LABD) have been exited (not advice, not a recommendation).

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 … Train Keeps Rollin’

April 4, 2023 By in $SPSIBI, Biotech, LABD, SPBIO, The List, ZeroHedge 1 Comment

Correction & Reversal, Gaining Steam

The biotech sector’s (upside) correction is complete.

If that’s correct, it’s likely to get very serious to the downside (not advice, not a recommendation).

A massive list of fundamentals, i.e., ‘side effects’, have been documented on this sector’s reprehensible behavior (saying it politely) over the past three years.

‘The List’

From here on out, we’ll call the linked information that follows, ‘The List’. So, we have The Biotech List, linked here, here, and here.

In the past few days we can add more items to the list, here, here and here.

When The Money Runs Out …

Now, it looks like the money (and ‘patient’) spigot is running dry as reported here.

So, let’s see how that’s working itself out for chief cook and bottle washer; biotech, SPBIO.

As usual, we’re looking at 3X, leveraged inverse fund LABD.

SPBIO, Leveraged Inverse LABD, Daily

Sharp reversal to the upside.

We’re nearing the end of today’s session (2:55 p.m., EST) and price action has been relentless.

Looking at the weekly chart of LABD, we see the trendline being confirmed.

Biotech Leveraged Inverse LABD, Weekly

A reasonable expectation for the next session(s) is some type of back testing of today’s action … although it’s not required.

Positioning

Yesterday’s downside LABD, action forced the complete exit of the main position that was (in-part) established during the downside thrust on February 2nd.

Overall profit gain on the series, was just over + 44%.

So, we had partial exit with +37%, main exit with +44%.

Later in the session yesterday, it became obvious the downside correction (from March 24th) may be nearing completion; the main position was re-established @ LABD 20.27 (not advice, not a recommendation).

Today’s action puts that entry well in the green.

If this really is the next leg lower (higher for LABD), the expectation is for significantly increased volatility.

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