During a week when I am being compelled to evaluate whether the ‘market bounce termination’ view will be correct (it has exceeded target, after all, though I am giving it wiggle room) and hence, whether my short on SPY will be correct, let’s take a look at one specific sector, Healthcare, which includes Medical Devices, Services, Pharma and Biotech.
Healthcare is an area that has been beaten down with the market corrections of the last 7 months and in the case of Biotech and Pharma, the political backdrop. Recall here our monthly chart of the Biotech index vs. the Nasdaq 100. It’s battered, but still at a secular bull market ‘higher low’. Still, I am more interested in healthcare in general (which is why I’ve held device maker BSX and previously, MYGN) than this volatile specialty area.
The Healthcare ETF has not recovered with the market but is in a fairly decent looking pattern by daily chart, sitting above the 50 day averages with MACD and RSI positive.
Its weekly chart is still in a downtrend, however. It could be on its way to a test of the top downtrend channel line.
Old guard large cap Biotech stock AMGN is bouncing from a long-term trend line by weekly chart.
Big Pharma, PFE meandered out of the top downtrend line after holding long-term support at 28.
Current hold and original NFTRH+ item, BSX is still in an attractive looking daily chart pattern.
Just some FYI pictures for your review. I happened to be looking them over and thought I would share them with you. I may buy one or two items noted above, with the big market view likely playing a big role in how long they are held.
I have not given up on the bounce termination view, but it is on life support. Especially with the events in Brussels, the likes of which do not tend to be bearish beyond the immediate flashpoint.