Friday, December 22, 2023
LABU - Biotech Recovery Rally!
Biotech had a deep bear market and finally became very oversold in October. Market conditions have been generally improving and Biotech is a sector that may benefit more than most due to the oversold condition. Since October LABU has doubled and appears to be still early in a recovery rally from oversold conditions. Daily charts
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I figure LABU is one third into this rally. Two thirds left in the rally gives a target around $200.
ReplyDeleteThere is no weakness at all in the LABU daily chart and the 50 day average is pushing it higher. This is suggesting there will not be much pullbacks.
ReplyDeleteAlso have a look at the LABU weekly finally reaching oversold in October and now breaking above 50 weekly average $108.60.
ReplyDeleteConclusion - The bottom is in on Biotech!
ReplyDeleteBought the breakout LABU $110.50.
ReplyDeletewill today's gap be filled soom?
ReplyDeleteNo I think this is on the way up now. Even though it's had a good start and run last few months, LABU is still cheap here.
DeleteThere we go! LABU gap over the 50 weekly. Meltup!
ReplyDeleteThe incredible strength in Biotech is largely due to the extreme oversold condition and improving markets. This occurred at the same time as the flu season beginning in October and with record travel that has contributed to the spread. This winter it's a mix of COVID, flu, and RSV.
ReplyDeleteXBI a little overbought on daily.
ReplyDeleteSPX may be in a waiting pattern until the 2024 GOP presidential primary kicks off January 15th with elections in Iowa and then New Hampshire
ReplyDeleteIt's been an incredible run.
DeleteYes it has. The October GDP upside surprise led to strong rally.
DeleteSc im still confused...
ReplyDeleteYour saying 4400 will be the low of 2024 before we launch to 5200 spx plus ?
Basically SPX is trending higher but as we get into 2024 there are going to be larger pullbacks. Once over 5,000 then yes we can expect a bear market from that level.
DeleteNext week we can see small dip. Market is looking a bit overbought. SPX has some RSI divergence in daily. Minor dip with sideways for next 2 weeks.
ReplyDeleteOverall expect we are trending up into March.
ReplyDelete2024 kicking off with a bang! With Biden in office it'll be a wild year!!
ReplyDeleteThat's for sure!
DeleteSPX cooling off as anticipated.
ReplyDelete'The Stock Trader’s Almanac' refers to the first five days of January as the “Early Warning System.”
DeleteThat's a good point! Already the markets are starting the year a bit rocky.
DeleteI don't think it'll be a bad year but it will be more of a roller-coaster ride.
We should see next week down also, then rally for a couple weeks.
ReplyDeleteSPX fading today
ReplyDeleteSPX probably close on lows today.
DeleteWe may see a small bounce early next week then lower low
ReplyDeleteSC, do you have a price target for UVXY at his minor pullback? If then, what is it?
DeleteNot yet, these minor pullbacks won't likely do much for UVXY just yet. But SPX major pullbacks are coming this year and then it does get more interesting.
DeleteWe can expect some nice volatility trades this year with all the turmoil. So let's wait for a setup.
DeleteSC,
ReplyDeletewonder what's your thoughts about FAZ. It usually goes with UVXY though.
It's actually amazing how poorly banks have performed since 2009. They are still zombies. The last bear market 2022 and 2023 was particularly brutal for the banking sector. We can see this with BKX.
DeleteSo I like your line of thinking and BKX may test 2009 levels in the next bear. It could be disorderly...
DeleteLoL, you are right, Zombies! I was not sure how to put a word for that. FAZ's been sleeping more than a decade so wonder the time may come to wake up??!
DeleteLABU ramping up again. Looks like the next leg up has begun. May see $155 on this push.
ReplyDeleteBiotech moving up nice and steady. Expect higher for 2 weeks run.
ReplyDeleteYesterday was massive!
DeleteSPX sideways move called in December.
ReplyDeleteSCDecember 16, 2023 at 4:49 AM
"We did get the pop now SPX is sideways and down into January."
SCNovember 30, 2023 at 1:16 PM
"Might see an early December pop!"
Biotech the hot sector! I looked at MRNA but I don't like the chart yet. Best to stick with the Biotech index. LABU.
ReplyDeleteIf LABU goes up then NDX too?
ReplyDeleteYes that is a good point. NDX should rise.
DeleteSC when is a big drop suppose to happen?
ReplyDeleteFrom what price level on the SPX to what price level?
Expect a sizable drop to happen due end of March. I haven't looked too closely at numbers yet because it's early but 4,900 to 4,500 SPX maybe.
DeleteWhich way Crude Oil will go, any chance WTI price back above $90 in next three months?
ReplyDeleteCrude looks to be trading around support $70. I think it's at the low end of the range. It could rise as geopolitical tensions increase in Middle East.
DeleteWell now LABU is a little soft here. We do have that gap at $105 which may try to fill.
ReplyDeleteThen do you think LABU will rebound once it filled the gap around $105? then Run though end of march the time you mentioned SPX will drop?
DeleteYes LABU is in a strong uptrend likely for months. There is some weakness here but only short term.
DeleteWe will see vix above 30 this year?
ReplyDelete30's VIX is typically a common resistance level. Election year so probably won't see much over that.
DeleteI'm not expecting much for this week but anticipate small rally next week.
ReplyDeleteDo you see LABU at $105 this week?
DeleteI was thinking a small bounce next week then $105 LABU around end of the month.
DeleteHowever we will see some selling month end. Generally market conditions are weak for the next 4 weeks.
ReplyDeleteLABU came close today though XBI not quite there yet. Maybe best to wait another week.
ReplyDeleteLooks like 5000 us coming
ReplyDeleteQuite a surge for DWAC this week!
ReplyDeleteSold LABU $115.20.
ReplyDeleteBiotech still looking weak. Now I think we'll see a deeper pullback for LABU to $85.
ReplyDeleteSo I'll wait for lower entry LABU $85 with a target of $160.
ReplyDeleteSC... do you have a short term SPX roadmap you can share with us?
ReplyDeleteThanks
SPX is overbought on both daily and weekly times frames. We can expect a small pullback soon. It'll be relatively shallow. Probably only to the shelf at 4,700.
DeleteThe weekly SPX chart is strong so shallow pullback for now only.
DeleteXBI looks to be forming a bear flag. I may be short in next week or two...
ReplyDeleteSC... so is the market crash suppose to happen in 2025 then?
ReplyDeleteor 2026?
SPX according to plan posted November 16th. So we are waiting for higher levels above 5,000 for that big turn. This is still a bear environment. It's just that the market is trending up currently in this phase.
DeleteMortgage resets wave is hitting this year 2024 and 2025.
Timing estimate a year and a half from a model I use. We could be due for a bear market in second half 2025.
DeleteWe are almost at 5000 now.. so whats going to happen between now and a year and half from now?
Deleteif we are going to bear market then and not now?
just chop sideways?
We're going to see some substantial pullbacks with a rocky market. Then rally to a top. The topping process itself can burn a lot of time.
DeleteFor now I would say we should focus on trading pullbacks and I do think that SPX is sideways as we await the Election.
DWAC big trader. Lots of action to trade.
ReplyDeleteBought DWAC $33.00
ReplyDeleteI see Netflix is doing well. NFLX was my only pick of the Nasdaq
ReplyDeleteLABU formed the bearish flag as expected this week. However often these patterns will pop a little before reversal lower.
ReplyDeleteJust as I thought! Pop LABU. This week should be strong but reversal down due next week.
ReplyDeleteTrump got pinched for $83 million and that seemed to weigh on DWAC a little today, but it can see a bit higher this week. I was thinking around $45.
ReplyDeleteCould look at Biotech short soon. LABD.
ReplyDeleteTech earnings next so that timing makes sense why a dip is likely soon.
ReplyDeleteBought LABD $9.66.
ReplyDeleteBiotech starting to look wobbly. The LABU bear flag could break down soon!
ReplyDeleteTook profit sold DWAC $37.20.
ReplyDeleteI'll look at it again soon but we are seeing indications that the markets are rolling over.
DeleteSPX drops!
ReplyDeleteNailed it!!! Went short yesterday!
ReplyDeleteSPX appears to be bouncing into next week which is when the turn date is due!
ReplyDeleteNew chart posted!
ReplyDelete