Update-2 1/21/19… Heads Up Red Futures

Update-1 1/20/19…XBI at $83.38 approaching November resistance at $85


Biotech Rally Continues from the J.P.Morgan Healthcare Conference

  • Slow and steady gains for biotech rally in 2019
  • Volatility and sentiment good for traders
  • January effect after horrible December 2018

We appear to be in a risk-on mode as investors continue to nibble on stocks despite the nasty macro backdrop of BREXIT, the Shutdown and China trade. Any major progress on these macro issues should extend the rally As I have said many times before follow the technicals and stay in a trading mode which means prepare to raise cash if technical levels are breached on significant news.As we hear from major biopharma companies on 2018 earnings and guidance we should get a better picture on 2019. Clearly M&A has been a major driver of overall sentiment and mid-caps should benefit.There is a lot of day-to-day volatility on smaller caps so that is positive for traders on balance.

The QQQ just touched the SMA 50 level at $163.83 and is well off the Dec 24 bottom of  $143.50. And the small cap IJR as is usually the case, trades with biotech showing steady gains in 2019 up from lows in December at $65 to $75 today.Stocks took off in mid-afternoon trading on China trade progress then pared back after WH tempered optimism.

Large Caps were strong overall today with stand-outs: REGN up 3.17% near its 52 week high, ALXN up 2.61%, VRTX up 2.35%. AMGN was up 1.5% and received FDA advisory panel approval.for postmenopausal osteoporosis drug.

We will update Large cap Biopharma Performance from 1/19 at week end.If you bought 2018 laggards ALXN CELG and REGN you are a big winner in 2019.

Mid-caps joined the rally albeit not every stock but winners were: GWPH up 4.58%, ARRY up 3.75%, BLUE up 3.67%, INCY up 2.76%, ICPT up 2.58%.

  • The bellwether XBI is up 7.54% over one month as buyers came in on Dec 26.
  • The IBB was up 7.71% over one month at $109.79

Here are some of the Life Science and MedTech trades we made in 2019 and from JPMorgan presentations:

Amarin (AMRN) up 3.91 % today, 7.47% MTD.

bluebird bio(BLUE) up 3.67% today, up 22.35% MTD.

GenMark Diagnostics (GNMK) down 0.67% today, 29.9% MTD.

Teledoc (TDOC) up 4.73% today, 23.73% MTD.

XBI SPDR S&P Biotech ETF up 0.61% today 7.32% MTD.

We still hold all of these positions at a profit except GNMK which has a slight loss.

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