Same Old Sermon
The market has been kind to select biotech stocks.
There seems to be some steam building in this group. If the market as a whole
can continue its recovery from recent lows, biotechs may continue to be a good
vehicle for swing traders.
Myriad Genetics
(
MYGN |
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Chart |
News |
PowerRating), mentioned in Chart
of the Day on Oct. 30 continued to add to its earlier gains.
Same for Human Genome Sciences, mentioned
on Oct 31.Â
I want to emphasize that there is nothing particularly special
about these setups. They consist of standard patterns. The real difference is
that I want to see multiple patterns all intersecting at the same time so that
the odds of success are maximized. Yes, I know this the same old sermon, but so
be it. These require some patience to find, but they are worth the effort.
Continuing with this theme, here’s an interesting setup in
Medarex
(
MEDX |
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Chart |
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PowerRating).
Medarex
(
MEDX |
Quote |
Chart |
News |
PowerRating) is bouncing off the lows of its two-week
trading range and its 50% retracement within a seven-month uptrend. It’s worth
noting that the retracement is not off of some minor swing. This is a retracement
off of MEDX’s all-time high in March and the post-crash lows in early-April.
While this may appear to be an inviting setup, particularly on a
pullback to the range lows, I would strongly suggest that you keep your guard up,
as the market as a whole has a lot of work to do before it’s fully recovered. Biotechs are not likely to be immune if the the Nasdaq decides to extend another leg down.
Till Thursday,