The CURE short trade added last week has exceeded the suggest stop of 154.50 and will be move to the Completed Trades category. Personally I remain short & both near-term (days/weeks) & intermediate-term (months) bearish on the healthcare sector and the biotechs. As stated last week, I am actually more bearish on the biotech sector and chose CURE as my proxy to short it due to the large weighting and overlaps of biotech stocks within CURE/XLV (healthcare sector ETF) & the 3x leverage.
IBB daily May 19th
My reasoning for shorting CURE was to use the decay on the 3x leverage to my advantage if this trade morphs into a multi-month swing short as I still expect it might. To the best of my knowledge, the maximum leverage available on a pure biotech etf is the 2x leverage from BIB (2x long ProShares Ultra Nasdaq Biotech ETF), which I may also short as a supplement my CURE position should the biotechs roll over soon. As this IBB (Nasdaq Biotechnology Index ETF) daily chart shows, we have a several recent potentially bearish developments in the sector. See notes on chart for details.
Note: At this point, all of the Long & Short Trade Ideas have been updated meaning that any stopped out trade or trades that have recently hit their final price target have been removed. Keep in mind that due to the post tagging system, some ticker symbols that were covered in a recent post on an Active Trade idea will appear under the Long or Short Active Trades category due to the fact that both symbol tags were assigned to that post. One example is USO (and the associated tag of $WTIC; West Texas Intermediate Crude). USO is often covered in the same update along with the ERX/XLE active short trade as as such, USO/$WTIC will appear under the Active Short Trades category until the ERX/XLE short trade is closed out and all associated posts are moved to the Completed Trades category. There may be a few trades in the Long-Term Trades category in need of updating as well but I’ll be leaving for the remainder of the week soon & will have to wait until next week to review those trades.