August 20, 2019 8:55am
This market and our cell and gene therapy sector is riskier than carrying a loaded weapon with one in the chamber
Start slowly building a solid cash position selling into strength versus weakness
These past months of the RegMed sector have been “eye-openers” because when you are in the middle of it, you get up every day and struggle with the pricing “calamities” within the sector
It's a daunting task to understand risk, seeing the unforeseen; on the basis of my own “rules”, I set-up my own “warning analysis” which isn’t machine oriented!
Dow futures are UP +0.16% (+42 points), S&P futures are UP +0.13% (+4 points) and NASDAQ futures are also UP +0.20% (+16 points)
U.S. stock index futures were flat lining on Tuesday as yesterday and Friday’s rebound was set to pause;
European stocks were slightly higher as hopes for monetary policy stimulus temper investor anxiety over an impending recession with the pan-European Stoxx 600 edging + 0.2% higher and healthcare stocks rising 0.7%;
Asia Pacific stocks were mixed; the Reserve Bank of Australia’s July meeting minutes, released on Tuesday, showed the central bank would consider further easing while the People’s Bank of China debuted its new loan prime rates under a new mechanism;
Data docket: the Philly Fed non-manufacturing numbers will be out at 08:30 a.m. ET.
Henry’omics:
Traders are keeping an eye on the broader economy. On Wednesday, the Fed is scheduled to publish its latest meeting minutes. Investors are also likely to closely monitor the Fed’s Jackson Hole seminar and a G7 summit later in the week for clues on monetary policy settings.
The IBB was up +3.36% and the XBI were up +3.78% in two (2) sessions while low volume drove the upside moves.
August has 7 POSITIVE and 7 NEGATIVE closes, so far …
Another session of anywhere but, up …?
I am such a “wet blanket” these days as I DON’T TRUST the “machines and algorithm’s rules” to initiated random selling – just being aware of the influences around us!
Traders also remain focused on U.S.- China trade relations, after the U.S. Commerce Secretary Ross announced Monday that it was extending by another 90 days a temporary reprieve for Huawei to do business with American firms.
From Monday’s evening post, “the sector rallied; we saw the upside pricing stabilization but, I want to see sustainability before the “machines” start eating our universes’ gains. Don’t be misled by the big up days after an equal number of down sessions in August. Volatility is still expletive driven … that is why I said SELL.”
• The NASDAQ was up +106.82 or +1.35% to 8,002.81;
• The IBB closed up +1.13% and the XBI also closed up +1.13%
• The close was positive with an A/D Line of 36/6 and 1 flat and 2 acquired;
• The range of the 36 upside was +0.10% (GBT) to +13.54% (PSTI) while the 6 downside ranged from -0.09% (QURE) to -7.08% (BTX);
• 3 out of the 36 upside had higher than the 3 month average volume;
• 2 out of the 6 downside had higher than the 3 month average volume;
Companies in my headlights – It’s your decision; I provide an idea and context:
Resistance levels are tough to overcome … as one company “sneezes” other sector participants’ catch a cold and the whole sector gets infected …
Overbought:
Alnylam Pharmaceuticals (ALNY)
Bluebird bio (BLUE)
Pluristem (PSTI)
ReNeuron (RENE.L)
Solid Biosciences (SLDB)
Vericel (VCEL)
Oversold:
Bellicum Pharmaceuticals (BLCM)
Undervalued:
Applied Genetic Technologies (AGTC)
Global Blood Therapeutics (GBT)
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.
