October 16, 2018 8:17am

Value of the oversold should follow the upside spiral

You can lead a horse to water but you can't make him drink' is a proverb which means that you can show investors an opportunity but can’t force them to take it.

 

Pre-open indications: BUY

In compiling my indication signals, I draw on logic, historical precedents, specific knowledge of the sector and its practices as to lessons learned.  It’s important for investors to identify and determine which indication is actual performance based.

U.S. stock index futures are rising

Dow futures are UP +0.59% (+149 points) and NASDAQ futures are UP +0.78% (-57 points)

 

U.S. stock index futures indicated a slightly higher open Tuesday

European stocks were mixed Tuesday morning, as escalating tensions between Saudi Arabia and the West exacerbate geopolitical concerns and limit gains.

Asian stocks mixed following overnight slide on Wall Street;

Data docket: the U.S. Redbook data is due at 8:55 a.m. ET, followed by the industrial production numbers at 9:15 a.m. ET, and the Housing Market Index and the JOLTS numbers at 10 a.m. ET.

 

Today’s indications:

  • The iShares Nasdaq Biotechnology (IBB) is indicating a POSITIVE +0.85% UPSIDE in Tuesday’s pre-market;
  • The SPDR S&P Biotech ETF (XBI) is NOT indicating in Tuesday’s pre-market;
  • The Health Care Select Sector SPDR ETF (XLV) is NOT indicating in Tuesday’s pre-open;
  • The iShares Russell 2000 (IWM) is indicating a POSITIVE +0.19% UPSIDE in Tuesday’s pre-open

 

 

Henry’omics:

ANYTHING in “our” universe and sector is better than what we have been experiencing …

That said … NOT every equity in MY coverage deserves to be UP but, the herd mentality will push many “undeserved” upward!

Equity markets across the globe are feeling the pressure due to the tensions surrounding the missing Saudi Arabian journalist Jamal Khashoggi, with markets concerned about the possible impact it could have on oil prices.

I am still maintaining DEFENSE, CAUTION and MODERATION re whether this bag of oversold are ready to be bought!

I still believe BioLife Solutions (BLFS) with a 52 week change of +123.4% and Vericel (VCEL) with a 52 week change of +187.51% are overbought.

 

From Monday’s night’s newsletter: “Humpty Dumpty sat on a wall; had a great fall, all the market's forces and algorithmic rules haven’t seen Humpty hitting the ground – YET. Sector equities fell as indexes failed to bounce-back from last week's collapse as the oversold are still trying to find bottoms.

The iShares NASDAQ Biotechnology (IBB): a week’s history lesson; for a five session aggregate of -6.72% after 4 negative sessions out of 5!

Of the 45 companies covered on Monday; 26 downside equities finished in a range of -0.06% (BMRN) to -7.63% (VCEL) while 17 upside equities oscillated from +0.14% (MESO) to +11.43% (HSGX) with a 2 flat close (BTX and RENE.L).

Volume has been increasing … look at the depth – 5 out of 17 of the upside had higher (than the 3 month average) volume while the downside spiked with 9 having greater volume (than the 3 month average) out of 26.

  • In 11 sessions in October – there were 9 negative closes and 2 positive closes
  • In 19 sessions in September – there were 10 negative closes and 9 positive close;
  • In 21 August sessions – 6 had negative and 15 had positive closes

 

 

Companies in my headlights – It’s your decision; I provide an idea and context:

 

…. Pick from the many of the “parked and undervalued” …

 

Opinions expressed are those of the author and are subject to change, and not intended to be a forecast of future events, a guarantee of future results, nor investment advice.

Whether information or intelligence is good, bad or somewhere in between; I put into context what is relevant and useful for investors.  All investments are subject to risks. Investors should consider investment objectives.

Henry McCusker, the editor and publisher of RegMed Investors does not hold or have positions in securities referred to in this publication.