Biotech technical outlook still bearish


The downtrend in the biotech sector that began on February 26 ain't done yet. On a technical basis, (IBB +0.1%) has been trying to hold on to its wobbly base since its snap back move on April 15. Volume has dried up as the index struggles to stay above the key support level of the 200-day MA. This is not encouraging action for longs.

The relative strength line has dropped from a best-possible rating of 99 down to 68 with no upturn in sight.

Biotech investors should keep their powder dry until the money flow turns decidedly positive. Based on the chart, there is no indication that this is happening yet.

ETFs: XBI, BIB, BBH, FBT, PBE, BIS

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Comments (2)
  • DWD Investing
    , contributor
    Comments (13056) | Send Message
     
    Good idea to keep a eye on that 200 for sure. It would be a good correction if it keeps support at 200. Otherwise, bad news.
    9 May 2014, 12:16 PM Reply Like
  • asp924
    , contributor
    Comments (13) | Send Message
     
    The 200MA was taken out today. Next stop 290?
    21 Sep 2015, 09:11 PM Reply Like
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