chartwatchers
Long

LABU - A possible bottom

AMEX:XBI   SPDR S&P BIOTECH ETF
2308 38 42
a month ago
Yesterday we had a capitulation type of volume in XBI             , so I think we are very close to the bottom, or maybe we had it yesterday.
I still think that the 06.29-06.30 gap is a runaway gap - which will never be filled- and yesterday we almost exactly tested back the top of the gap. And today we couldn't fall anymore we are just bouncing from the gap.

So I think entering here is a low risk trade if someone set a stop below yesterday's low.
If we break below yesterday's low and enter into the gap we are going to fill that and we are getting very close to the 49$ level. If we break below 49$ I'm quite sure that we are making lower low in XBI             so the line in the sand is the yesterday low for me.
If we take that out I'M not interested in XBI             for a while.

Indicators
MACD is turning up and might want to cross over
RSI left overbought - in the past it was a sign of the next leg up.

We are charting in XBI             so you have to trade based on this when buying LABU             .
The 3x ETF chart ( LABU             ) is not good for charting.

LONG XBI             54.70 $
STOP 52.80 $

LONG LABU             26.90$
STOP when XBI             breaks below 52.80$


a month ago
Comment: If we break above yesterday's high - 55.83 $- that would be a swing low.
It would mean we have the follow through in the following days.
a month ago
Comment: LABU might shine tomorrow after market open.
SPX looks great
snapshot
a month ago
Comment: Closing 50% of the LABU position now.
19 days ago
Comment: Closing the other 50% of LABU today.
19 days ago
Comment: Price 43.48$
19 days ago
Comment: Money is flowing out of SPX as it's breaking out.
snapshot
19 days ago
Comment: For the same run (near 45%) we had to be in LABU from the 1st of July till the end of September last time.
This time it was 2 weeks.
DS77
a month ago
Funny... was just thinking about this and looking at IBB / XBI. Bought a little LABU @ 25.00 in premarket, but am looking to hedge with some XBI puts for 11/18. Think we see some form of tantrum in the market next week before we head higher so I want a little protection just in case.
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archie123
a month ago
Next week could produce another dip with the election, but we should be close to buying.
Thanks for the update.
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bhowe
a month ago
Thanks for the info. I was actually looking at this as a possible bottom. It looks like a Bullish Bat Harmonic pattern completing at the 88.6% fibo number. A turn here should get us to $40.10 or the 50% fibo.

snapshot
+1 Reply
Hks6996
a month ago
Before this was posted I added to my LABU position...
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shawn.ctech
a month ago
Another great idea. I can confirm this move also with fundamentals. Believe it or not, healthcare sector will be one of the best performing sectors of S&P toward the end of the year to next year. Election is priced in, we might get a little more dip if Hillary gets elected, but something that would eliminate all this election charade is the drug pipeline. 49, yes 49 FDA pending approvals are coming out this year. That will confirm the reversal. This level is great to open a position, i personally might just wait until after election.
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archie123 shawn.ctech
a month ago
Interesting observation that the 'election is priced in' already. It appears folks are not waiting for election results but getting back on board.
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shawn.ctech archie123
a month ago
Markets want you to believe in "Efficient Market Hypothesis" because if average investors dont believe in it, they would call the system rigged, gamble.... They wont participate. A lot of market events are baked in the cake.
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jolu
a month ago
just a question please:
To be clear, since we entered LONG at 41$ on LABU we never sold our position right?
So ,if now we break below 52.8$ on XBI we should get out of LABU with looses (because we will be heading south..)?
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Notyour
a month ago
LABU/XBI is inversely correlated to Hillary ...
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Notyour
a month ago
Hi Arpi. Why closing half position? In case of Trump?
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Notyour
a month ago
Hi Arpi. Why closing half position? In case of Trump?
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chartwatchers PRO Notyour
a month ago
Yep. The electio result going to be tight . So after yesterday's monster rally maximum a consolidation will be today.
If Trump wins stocks will fall. If Clinton wins not sure immediately will be good for LABU.
A clinton win is already in the stock price.
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Notyour chartwatchers
a month ago
If Hillary win is already priced then better to bet on gold? Downside should be limited now.
In case of Trump victory gold could skyrocket
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chartwatchers PRO Notyour
a month ago
You nailed it.
If Hillary is the winner why no follow through in the stocks.
It might be a dead cat bounce before a final panic selling.
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Nightstar chartwatchers
a month ago
Arpi.. Do you honestly think that Gold has already priced in Hilary as the next potential President? Miners are still looking soft in the middle.
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bertcoin PRO
a month ago
GO BABY GO! LABU LOVES TRUMP!
+1 Reply
toothless bertcoin
a month ago
@bertcoin, up 35% at the moment. Insane day for biotech.
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Hks6996
a month ago
Love LABU, and I thought gold ETFs were going to be the big winners today... omg...
+1 Reply
archie123
a month ago
This is crazy ! Anyone care to speculate on what tomorrow will bring ?

Apri -- you had it nailed spot on with the buy XBI at 54.7 (LABU 26.9). Congratulations !
Those folks that bought LABU at $25 are very happy. Bigger money today in XBI/LABU than Gold.
Who would have thought...
+2 Reply
archie123
a month ago
Apologies -- Arpi not Apri -- mistake in typing.
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Staxs
a month ago
It would seem for now XBI and LABU can keep running so long as the SPX500 holds firm. XBI tanked last year (July) after the Clinton tweet targeting BioTech profits.

Earning season has been OK so far so would like to see XBI take out the 2016 high before year end and it could come quickly. So another 30-40% rise in LABU perhaps.
+1 Reply
2use
a month ago
Wow, did you just close 50% before that monster move? Why is Biotech running that much on trump?
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Mortan 2use
a month ago
@2use, bacause Hillary wanted to regulate drug prices, Trump not.
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MrRick
a month ago
Good call April. Unfortunately it moved so fast my gun was shaking and powder shot all over the floor. Maybe next time.
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Bearbud
23 days ago
Arpi, LABU recovered nicely, where do you see it going from here?
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playthetrend
19 days ago
A great call for LABU, thank you for this call.
+1 Reply
VirtualFax
19 days ago
Where is it (i.e. money) going?
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chartwatchers PRO VirtualFax
19 days ago
@VirtualFax, in these hours to dollar.
When it's done will go into commodities.
+1 Reply
VirtualFax chartwatchers
19 days ago
Thanks man. Too bad you have been keeping low profile in the last couple of weeks. Your fundamental insights are precious. Come back : )
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chartwatchers PRO VirtualFax
19 days ago
@VirtualFax, I'M here , just not posting so often. End of the year is very busy at my companies..
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bertcoin PRO
19 days ago
Thanks Arpi. I sold 1/2 a couple days ago, worried about the S&P topping after the Trump run. You confirmed my worries. I'm out too.
+1 Reply
Guybrush80
19 days ago
I think XBI would go to 75.... it will not realize to touch 80... and then I will promptly buy LABD ... near end of November. This is my opinion.
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lbg01 PRO
19 days ago
Great Call°
Thanks and keep up the great work
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toothless
18 days ago
We bounced yesterday and today on structural support and the 10 EMA on XBI. I'm holding juuuust tiny shares LABU long to see if this support breaks. If so, then I'm closing, but I want to see if we bounce up and off from here.
snapshot
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toothless toothless
7 days ago
@chartwatchers Arpi, this support looks like it's still holding. Do you see this as strength and we bounce from here?
snapshot
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keefer0
18 days ago
Can we get your update for NGAS, interested to see if you added to your position. Thanks.
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Guybrush80
15 days ago
Pullback or trend reversal?
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@gandonian11 This was a good call
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