One of the big themes we see emerging into 2025 is an expansion in Biotechnology.
XBI is certainly a good ETF to look at.
However, we have used the ETF IBB, our Big Brother in the Economic Modern Family, as both pharma and healthcare companies have a huge hand in the lobbying influence and in our everyday lives as consumers.
AI is one area of growth, particularly as it pertains to patient records and treatment plans.
Diet drugs are another area of growth.
Plus, as new viruses emerge, drug companies will create new vaccines.
I am also 100% convinced that once pharma companies (and tobacco companies) figure out how to monopolize and capitalize on the cannabis industry, that will pass through legislation easily.
“One pill makes you larger and one pill makes you small”
From a technical standpoint:
The Daily chart is interesting in that the price is squeezed between the 50 (blue) and the 200 (green) moving averages.
Real Motion shows the moving averages in a bearish phase as the dots are below both MAs and the 200 is above the 50-DMA.
Price chart is a caution phase so quite different.
The Leadership chart tells us that IBB begins the week outperforming the benchmark.
And the calendar range, (high-green horizontal, low-red horizontal) tells us nothing as the price is right in the middle of the range.
I would not rush into this position long or short. It is though, one we are watching carefully.
I would watch to see if IBB can get to 144 and hold 140.
Longer term, we are ok waiting until after the new calendar range resets in January.
ETF Summary
(Pivotal means short-term bullish above that level and bearish below)
- S&P 500 (SPY) 600 pivotal support
- Russell 2000 (IWM) 238 support
- Dow (DIA) 445 pivotal
- Nasdaq (QQQ) 507 support
- Regional banks (KRE) 65 support 70 resistance
- Semiconductors (SMH) 250 resistance 240 support
- Transportation (IYT) 71.40 the 50-DMA to hold
- Biotechnology (IBB) 140 support 144 resistance
- Retail (XRT) 80 support 87 resistance
- iShares iBoxx Hi Yd Cor Bond ETF (HYG) 79.50 pivotal