Why iShares Nasdaq Biotech ETF Is Ready To Break Out To New Highs
Deron Wagner | Aug 23, 2012 07:54AM ET
The iShares Nasdaq Biotechnology ETF (IBB), which we have been long in the model ETF trading portfolio of The Wagner Daily since August 14, showed relative strength by rallying 0.9% while the S&P 500 was flat yesterday (August 22). More importantly, it closed just above an area of near-term horizontal price resistance. For swing traders who missed our original August 14 buy entry, IBB is now presenting a secondary buy setup (or a place to add additional shares to existing position). The first chart below is of the hourly timeframe, which shows yesterday’s breakout above the near-term technical price resistance (the dotted blue line):
Shifting to the daily timeframe, notice that yesterday’s rally in IBB also correlated to a breakout above the downtrend line from the July 27 high (the descending blue line). Since this ETF has broken out above resistance levels on two different timeframes, it further increases the odds of IBB moving higher from here. If looking for a secondary buy entry into IBB, consider a buy trigger above yesterday’s high of $134.32, which would confirm the breakout above resistance:
IBB is presently on our Potential Breakout watchlist, near the top of the list due to the relative strength to the broad market it has been showing.
Original post
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.