Biotech is correcting for sure right now. This data speaks
volumes. 57% of the healthcare, pharm, biotech stks I follow
(about 100 stks total) are on MacD sell signals. That is
a lot, up from 36% a week ago and 31% the week before that.
And 19% are on RSI sell, down from 31% a week ago, and 28% the week
before that. The avg daily volume in these individual stocks
has increased significantly over the summer, which means
institutional presence, and institutional
accumulation/buying. So if you choose to short, I urge
you to be careful, nimble, and fast, b/c you will be
shorting one of the strongest sectors this summer. XBI just
went into a double top pattern with price objective
of $60.20. So you may only have 10% down move. Not
enough for me personally. Ideally one would want to
short the weak sectors and go long the strong sectors.
Once these 3 sectors (biotech, pharm, healthcare) and the
overall mkt hit bottom, these have a high probability
of being some of the best performers for longs over the
next year. So these sectors are not the best sectors
to short. Yes they are correcting, yes institutions are
distributing in the short-term, but it is a pause in my opinion,
not a long-term down trend. Instead these sectors are in an
up-trend. Best shorts for the near term are financials
and real estate, both in down trends, until proven otherwise.
And if you want to look ahead to the future, you will most likely
be richly rewarded if you take time now, research them, and
pick out your favorite stks and efts in these sectors to
buy/go long as soon as we hit bottom. If you are a
swing trader, you may or may not choose to short right
now, but your time would be richly rewarded if you instead make
your picks and get your trigger ready to go long these three
sectors once we hit bottom. These three sectors will be
some of the ones to fly the highest in the next year. I would
encourage you to cast a very broad net though, not just 1 or 2 or
3. Buy a lot of different ones or buy the etfs. Biotech
is risky, just the nature of the beast. Just my opinion.
Posted by dallahoo on 25th of Aug 2008 at 03:30 am
thank you very much for taking the time and also for thoughtful
observations, much appreciated. I was just looking around to see if
there were any ETFs that would specifically short biotechs? I
myself could not find any, I think there is a very good chance of
at least a pullback in the sector. sometimes nice short term moves
happen in areas where no one really talks about. BBH looks like a
huge top, with an inviting gap well below, it may work, it may
not. So, is there any short Biotech ETFs?
thanks, so much, again
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biotech
Shorting Biotech
Posted by andreac on 24th of Aug 2008 at 07:34 pm
Biotech ETFs: BBH, FBT, XBI, IBB
Biotech is correcting for sure right now. This data speaks volumes. 57% of the healthcare, pharm, biotech stks I follow (about 100 stks total) are on MacD sell signals. That is a lot, up from 36% a week ago and 31% the week before that. And 19% are on RSI sell, down from 31% a week ago, and 28% the week before that. The avg daily volume in these individual stocks has increased significantly over the summer, which means institutional presence, and institutional accumulation/buying. So if you choose to short, I urge you to be careful, nimble, and fast, b/c you will be shorting one of the strongest sectors this summer. XBI just went into a double top pattern with price objective of $60.20. So you may only have 10% down move. Not enough for me personally. Ideally one would want to short the weak sectors and go long the strong sectors. Once these 3 sectors (biotech, pharm, healthcare) and the overall mkt hit bottom, these have a high probability of being some of the best performers for longs over the next year. So these sectors are not the best sectors to short. Yes they are correcting, yes institutions are distributing in the short-term, but it is a pause in my opinion, not a long-term down trend. Instead these sectors are in an up-trend. Best shorts for the near term are financials and real estate, both in down trends, until proven otherwise. And if you want to look ahead to the future, you will most likely be richly rewarded if you take time now, research them, and pick out your favorite stks and efts in these sectors to buy/go long as soon as we hit bottom. If you are a swing trader, you may or may not choose to short right now, but your time would be richly rewarded if you instead make your picks and get your trigger ready to go long these three sectors once we hit bottom. These three sectors will be some of the ones to fly the highest in the next year. I would encourage you to cast a very broad net though, not just 1 or 2 or 3. Buy a lot of different ones or buy the etfs. Biotech is risky, just the nature of the beast. Just my opinion.
thank you very much for
Posted by dallahoo on 25th of Aug 2008 at 03:30 am
thank you very much for taking the time and also for thoughtful observations, much appreciated. I was just looking around to see if there were any ETFs that would specifically short biotechs? I myself could not find any, I think there is a very good chance of at least a pullback in the sector. sometimes nice short term moves happen in areas where no one really talks about. BBH looks like a huge top, with an inviting gap well below, it may work, it may not. So, is there any short Biotech ETFs?
thanks, so much, again