Biotechnology & Healthcare Sector on watch for Week of May 16

This week i'm focusing my attention on the Biotechnology, Pharmaceuticals, & Healthcare sector. With many companies seeing their market cap slashes as much as 50%-80%, how much more can this sector take? The S&P 500, and the rest of the market started to show cracks in the infrastructure recently. To make matters a lot of shorts have piled onto and already very heavy shorted sector. Take Valeant Pharmaceuticals for example, 30% of its floating stock is currently short. Being the contrarian that I am, In my opinion this could be the perfect "Bear Trap" for a massive short squeeze.

Lets review the charts of both LABD & XBI to further illustrate my point.

Weekly chart of XBI is very bullish. 3 indicators along w/ a Green Ichimoku  Green Cloud
points to this. You can visibly see the Green Ichimoku cloud now acting as support. The green
dotted line, is the money flow Index (white circle) its currently over sold.
A breakthrough would be very bullish for XBI & the Biotechnology Sector. The Macd is potentially setting up for a bullish corss over (blue dotted)line (white circle). The bottom indicator is the Stochastic RSI which already bottom, and now showing signs of like




Daily chart of LABD, which is a Bearish 3x leverage etf. It is designed to take
advantage of bearish activity for the Biotechnology sector (declining stocks).  Like I said earlier
in my post, majority of companies/stocks have already seen their market cap slashed in half, some even faced bankruptcy, others were forced into mergers. However, the trend appears to be changing. 

We are now seeing a Bearish Technical Pattern on a Bearish 3x leverage ETF, which has me bullish for this overall sector. This pattern you areviewing is a Head & Shoulders pattern. Notice the 3 white circles. I'm currently focusing my attention on the right shoulder, as the left shoulder and Head have already formed. Keep your eye on XLV, XBI, Pharmaceuticals companies this week for a potential turn around, as this sector could turn possibly bullish.