Taking Profit on NFTRH+ Trade, ABBV

Less than 3 bucks from target #1 (75), I am taking the profit here. ABBV is very overbought as it led the momentum that recently whipped up in the sector and I am not giving back the gains. Of course, I did the same thing with LRCX last year, the Semi stock that ABBV was compared to in this now public NFTRH+ post from April. I ended up selling LRCX way too early and that is a mistake I am glad to make again.

abbv

So the technicals are overbought but still very bullish (on a weekly chart). But the main issue here is my view on long-term interest rates, which tend to be negatively correlated to Bio and Pharma. I think the Treasury bond play is getting cooked now that we are way beyond the time when it seemed like NFTRH was the only one bullish on bonds (bearish on yields).

sectors as yields rise

TLT came to a hair under its target of 129, after all. What is that little candle, a shooting star? Well today TLT is getting clobbered and I want to minimize exposure to anti-interest rate items. Plus I am on vacation over the next week or so and relaxation is a priority. In that regard, I’ll probably also take the profit on XLV, which got pumped too much lately as well and also contains a lot of Pharma stocks.

tlt

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