Biotech is bouncing back
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Traders are flying their crazy flags as Brexit voting begins today.
Yesterday’s morning melt-up was interrupted by another one of these polls. A couple of news outlets reporting on a possible Brexit win is all it takes to torpedo any rally in this environment…
Luckily, one unlikely group of stocks fought higher yesterday amid the market’s whipsaw action.
I’m talking about biotechs.
These stocks have been a confusing bunch since the sector bottomed out in February. We’ve seen two false start rallies since April that have completely fallen apart—and a couple of false breakdowns, too.
In early June, we were treated to some exasperating action from the iShares Nasdaq Biotech ETF. A multiple sclerosis therapy from industry giant Biogen flunked its study goals, which was apparently enough bad news to drag down the entire sector and kill its two-week rally off its lows.
During the market correction, we’ve seen firsthand what happens when investors shun risk and flee to big, “safe” stocks. Biotechs and other speculative names got crushed. It makes sense. These are the stocks you’d normally knock down a few pegs when the going gets tough. That’s why it was surprising to see these stocks take the lead on Wednesday as the major averages tanked…
These sickly stocks are finally showing some signs of life—and could be putting in another choppy bottom…
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Yesterday’s reversal could be the start of another bottom-bouncing biotech rally—and a chance for you to ignore the Brexit noise and focus on a potentially powerful new trade…
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