I Feel Sorry for Your Conference

I have been staying off the short side for a while now, due to the most recent market melt-up from the grave.

However, biotechs are starting to intrigue me again. Recall last winter we played BIS (ultra-short biotech sector ETF) several times successfully as the biotechs were the first batch of leaders to roll over.

With ASCO set to begin imminently, I am looking at the contrarian case again for the biotechs given their sharp rally in front of the conference and the lingering technical issues with major names like Amgen, seen below on the daily chart. After all, it is seemingly a no-brainer to be long biotechs into a conference. And thus the contrarian angle.

Note Amgen’s declining 50-day moving average as price punches the upper Bollinger Band. If we see downside rejection tomorrow I will take a stab with the BIS. Otherwise, it is on the radar next week.

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