Biotechs In The Balance
Due to a scheduling conflict, Dave Landry will be
unable to write his Stock Trading Outlook. Tonight’s column is written by Dan
Delaney. Dave will be back on Monday, November 20.
There were no meaningful covered option opportunities that set up tonight.
(Friday)
The biotechs
(
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PowerRating) sank again Friday and established a
new three-month low before closing below its 200-day moving average. This
pattern is reminiscent of what the semiconductors
(
$SOX.X |
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PowerRating) went through
in early September just before they collapsed.
If further weakness continues in the index, traders may look for
buying opportunities in puts and put spreads.
 
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The semis
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PowerRating) managed to claw their way back from a
mid-day downdraft, but still finished the session off 0.5%. They are still
vulnerable to the downside, so look for buying opportunities in puts and put
spreads.
Banks
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$BKX.X |
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PowerRating) fell 1.4% and were also continuing the
weakness that began nearly two weeks ago. Concerns about weakening bank loan
portfolios have hurt the sector, and the fact that the Federal Reserve left its
policy bias unchanged also weighed on the index. What would help the banks would
be continued signs of an economic slowdown as well as a more clear indication
that the Fed will cut rates at its December 19 FOMC meeting.
Retailers
(
$RLX.X |
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PowerRating) bounced back another 2.4% and have
come back from oversold levels, but they still remain in a longer-term
downtrend.
Best of luck with your trading on Monday!