IBB
Biotech tests very important support zoneThe Biotech bubble bursting hits Nasdaq and makes it the weaker link in the indices chain.
It all began when $IBB broke below 360$, closing below its Fast SMA line, providing the bearish signal by breaking down the weekly uptrend line (see point 1)
August's declines lead $IBB to re-test another weekly uptrend line and the 300$ support zone - This created a rally back towards 360$ that ended when the price was rejected by the 360 structure and the Fast SMA line that flipped roles to resistance.
Now, three week's later, $IBB is re-testing the 300$ (currently inside the zone). It is also re-testing the same uptrend that helped it during August.
That is a critical zone for Biotech. The next support zone is near 260$ and below it, the 200 weeks MA waits near 230$.
If $IBB will manage to find the necessary support inside 280-300$ again, it could lead to a rally towards its 50 weeks MA line that should turn to resistance now.
A close above 300$ could be a bullish confirmation signal that we are heading there.
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IBB Possible 5-10% retrace - Price above correction base POC.
- Plenty of vol catching this, making a higher low since the Black Monday's sell off.
- Some nice volume with the pop of the trendline resistance.
- Three 'white' soldiers on 1H time frame.
First stop the naked POC at ~310, if this breaks a move up to ~320 with a max of ~334 before continuing its path down.
SHS in spe IBBSHS Target 335 over a month
On the premise that the top has been set in IBB I see the following SHS setting up.
Target 335 around mid august. and lower target later yes year!
I have the the technical argument below
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IBB Channel (Bearish)We've seen the IBB have trouble with this 368 level many time. We've now touched on it 3 times. and the highest probability move would be back down to the low of the May18-June 6th Channel.
While I still expect a bounce from the oversold condition onthe indexes (QQQ's etc) I am considering a speculative IBB Put (Short) Position for the next 2/3 trading days.
We are at the lower end of the Implied Volatility range on IBB (31%), so the premium is fairly reasonable.
One Contract for a 365 Strike Put with about 11 Days to expiration costs $600, and would be worth $900 if IBB hits 361 (or the bottom of its channel). Thats a 50% Gain.
Stop loss would be 369 or 370 area.
IBB: Going Sideways?This chart is a little busy so allow me to explain what whats going on here. The Green trend lines is long term support/resistance formed in the 4th quarter of 2012. The red trend lines were formed in late 2014. And the blue trend lines is the most current trend.
Ultimately, I think we are going to get a prolonged period of sideways volatile action out of IBB for two reasons. First off is the immediate sell off after hitting the upper green trend line. Every time the IBB has touched this trend line it has pulled back to the lower green trend line. Second, I have not seen this type of volatility in IBB in an extremely long time. I do not believe the huge swings from the highs and the lows can sustain neither a breakout or breakdown. At this time I believe it is most logical for IBB to consolidate in a zig zag channel for a period of time.
Today's price action is interesting because it backed off as soon as it touched the support line of 2014, a classic example of where support becomes resistance. But we can not ignore the fact that IBB had its highest close in the last few weeks. I think it is 50/50 we see immediate follow through from here to 360-370 or come back to the support zone of 325-335. The higher percentage trade would be to wait for price to come to these sell and buy zones.
**Any strong impulsive moves into and through my stop zones will indicate that IBB has come out of this bounded range and has begun its' new trend. That goes for both breakouts and break downs. The green trend lines would then become the targets for the new trend.
SPY still making higher Highs..stay BullishSPY is still holding the 50dma, and making higher highs and so has the other indices like the IWM, QQQ and DIA. that being said, the Biotech Sector (IBB) is the only sector that one should be weary of, as it has been making lower lows in the intermediate term. It seems as though there is a bit of sector rotation going on. I remain bullish on all the indices, but will stay away from the Bitoech sector until we can get a bit more clarity of the direction. For now i remain Bullish on SPY.
IBB $339.34: Corrects to break below 6-1/2month rising trendlineIBB corrected lower from the YTD high at 374.97 (March 20, 2015) to break blow 6-1/2 month rising trendline (as shown on the weekly chart), signaling prolonged consolidation near term. Bears look to test the range support at 333.78 (March 26, 2015 low). A breakdown is needed confirm a double top at 374.97/368.25 and weaken further towards the 305.01/302.98 long term support area. However, if the 333.78 area holds dips, that would reinforce the level as support. Back above 353.11 would suggest scope for further gains towards the 368.25 swing high (April 23, 2015).
Outlook:
Short term: bearish
Long term: bullish
BIS- Inverse Off IBB Could It be? A Double Bottom In The Making?4-22 Could It Be? Is this where we carve
out a double bottom? If so then IBB (longside)
MAY be carving out a double top. Remember,
going long this is gaining short exposure in the
bios. BIIB (Biogen) reports so be aware it could
have an impact on this issue. Chart wise its
all about an upside crossover of the green line.
Feel free to follow on TWTR at
@AmazingPatterns
For informational and educational
purposes only, these are not
recommendations, trade at your own risk.
IBB- Speaking Of A Pullback To Multiple Supports?4-2 Speaking of a pullback to multiple supports?
As long as this issue stays above the blue
support lines all is well. This level also
happens to be near the 50 day SMA.
If you like these kind of chart set ups
don't forget to follow me here or on TWTR at
@AmazingPatterns
For educational and informational use only,
these are not recomendations , trade at
your own risk
REGN- Nice Looking ABC To Multiple Supports4-1 Nice looking ABC to multiple supports.
As long as this issue stays above the blue and
green support lines all is well. This level also
happens to be near the 50 day SMA.
If you like these kind of chart set ups
don't forget to follow me here or on TWTR at
@AmazingPatterns
For educational and informational use only,
these are not recomendations , trade at
your own risk
Did Friday marked the current top of BioTech?After breaking and violating my previous setup on $IBB, the selling action we've seen on expiration date could mean that options traders finally think $IBB has reached too far.
When this selling action comes with a daily bearish AB=CD pattern, it becomes interesting.
If indeed we will see a pullback, the first point of interest will be the meeting point with the broken trading channel shown in the chart. That will be the test point for the bulls - They can either confirm the breakout by buying at this level, or fail to hold against selling pressure and the breakout will turn into a false one, signaling the bears to keep on pounding a very overbought market.
I'm with the bearish AB=CD pattern, meaning - short.
CEMP Cempra short interest spikes above $24$CEMP Cempra is at trend line technical & psychological resistance from Q3 2013. Many traders must see this also as short interest has been spiking as show in the bottom panel (data gleaned from FINRA, NYSE & NASDAQ and provided by Quandl). The lower trend line sits approximately at a L5 Cyclical Support level and would be a likely target and initial location for covering. If price pops above $30, a short squeeze would take place and provide fuel for a run close to $33-34. Earnings are coming up Feb Cempra is a highly levered, high debt speculative bio tech specializing in bacterial infections. EV/Ebitda = (15.81), P/B = 23.29, I believe $CEMP is working itself into a corner (price-wise) within this rising wedge. This indicates investors may be running out of patience. The more explosive move looks to be to the downside. I have a small speculative short position going into earnings. Nothing big. I probably should have executed a bearish call spread and limited risk and profit also as this bio tech arena is volatile.
Picking a fight with the biggest guy.Biotech is all the rage, I'll play for a quickie short on this once it gets to 412ish, provided it puts on a reversal candle of some sort first.. It'll be highly technical, you have to be very surgical, it's like picking pennies in front of a train, it's like cheating death, and me likey.
A better way to play this is to sell some call spreads once it gets to 412 (RSI red hot by then, probably), that way even if it consolidates, you still get the time decay.
One shortcoming is liquidity on BIIB options is how do I put this delicately, shtty.
Heavy short interest, proprietary technologyNow looks like a smart time to be investing in MNKD. Not only is Afrezza a better insulin than many available, not only does the technosphere eliminate a lot of potential unnecessary needles... the technosphere is the potential gold mine here. Imagine the FLU SHOT being a thing of the past... for the new, improved delivery system of a FLU INHALER. FDA can fast track drugs thru using technosphere... its already FDA approved. Many cultures in the world wont even USE a needle. Not to mention, HUGE SHORT INTEREST... once this sets fire, its gonna blaze...
REGN- See How Important The Use Of Trend Channels Are? 10-30 For those interested in buying support,
especially know considering how short term
extended things are these days. Its all about the blue line.
It also helps define ones entry risk here. If buying here
you are buying 20 points away from a support zone
(thanks anyway I say). Given this issue is tagging a
trend channel resistance zone? That is all the more
reason to let them come to you in the form of a pullback.
After all to a chartist the adage of buy support and sell
resistance is a classic mantra isn't it? Even more so
when you have an issue that just tagged the trend
channel resistance zone. Sure its pulling back but still
needs more chart time. This chart is also a good
example of how the trend channel keeps you away
from going long at the wrong time and AFTER a run
has been made already.
The use of trend channels are your best friend.
Not only do they help you manage the overall
trend they keep you from getting emotional at
key levels. At resistance? They keep you away
from that dreaded fear of missing it AFTER you
already missed it emotional trade. At support
they keep you away from caving into fear and
selling at a support zone.
For informational and educational purposes only.
These are not recommendations. Trade at your own risk.
IBB, GILD and CELG - Is this where we see a bear channel build? As you can see this issue has broken its green uptrend to the downside. Now its all about whether or not this issue and those who look like it (CELG, GILD) build out bear channels (orange) and then break to the downside once they complete a bear channel. Later today I'll be posting more charts that look like these so stay tuned for more.
These are not recommendations. Strictly for informational purposes only. Do your own research.
CELG looks ready to make move lower This major cap biotech company borke its major support at $150.
Now it acts like resistance.
ENTERING with tier1 here with STOP above $150 and will ADD through $144 for a poential move to April's lows at $134-$136 (first TARGET)
IBB (biotech ETF) looks very weak.
