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The Machines Have Runamuck
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More signs the machines have been reprogramed. Of course, that is a joke, right; everyone knows the machines don’t control trading, right? (sarcasm). Once again, the S&P 500 gapped lower, and failed to fill the gap by days end. Notice any patterns in the chart below recently; you should, the last 4 out of 5 days, have seen the same thing happen. Gap lower, recover some of the losses, just about enough to get back to the opening print, and then theย rally just falls flat on its face, not able to go positive. Anybody think, tomorrow will make 5 out of 6 days? Chances are pretty good we see the same pattern again.
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I still believe we are headed to 2,500, again it is nothing catastrophicย even if did.ย In fact, to start the year, very few if any investors saw the S&P 500 rising to 2,500. We’ll I did. But that is not the point; this is likely to be a minor 4-5 percent pullback in a much longer-term uptrend, bull market.
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Surprisingly,ย I called the rise to over 2,500 on December 22, 2016
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Biotech Sector Comes Alive
Look at the strength of the Biotech sector in a lousy tape. Look at that chart below of the Biotech ETF, $IBB, see what I see? Yeah, a double bottom, over two days, In a horrible market.
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Even more impressive look at the close for 4 of the big 5. Celgene, Biogen, Gilead, and Regeneron. All up, not far off the highs of the day either.
CELG Price data by YCharts
The sector has been pounded for over a month, but the technical support level at $300 to $303, has held firm and will not be easy to break.
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Watch the biotechs, and watch the big 5 stocks. Stocks that don’t go down in a lousy tape, only have one way left to go, up.
Good night.
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Michael Kramer and the Clients of Mott Capital owns shares of CELG
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$spy, $SPX, $IBB, $CELG, $BIIB, $AMGN, $REGN, $GILD, #SP500, #biotech, #stocks, #celgene