ibb

IBB: Once a Chart Guy…

While I currently work with all sorts of macro-fundamental indicators and inter-market ratio charts, I started out just loving the act of creating and analyzing nominal stock and market charts. I have a habit of obeying charts and while this has been a positive in the big picture, it sometimes shakes me out of positions simply because I saw something in a chart. The little hint shown on the chart could so easily just be an in-day shakeout, but truth be told I’ve wanted to get rid of IBB for a while now.

And so I think I see something in the chart of IBB and the Biotech sector (although I still hold the relatively bullish ABBV) and this daily chart.

ibb

So in light of a continued (for now, at least) hold of the relatively bullish ABBV and in light of the sentiment/CoT dynamics going on in Treasury bonds, and in light of the fact that Bio is not a sector that usually does well in a rising interest rate environment, and in light of the fact that NFTRH 449 unearthed more caution signals on the stock market… it is time to manage risk here for a limited loss. This includes raising cash and slowly creeping further short select areas.

Here is the Citi graphic correlating market sectors to interest rates.

sectors and yields

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