March 5, 2020 5:22pm
The sector and market have bounced to an extreme again to yet another oversold condition in terms of the relative strength index (RSI), which measures momentum
Pre-open indications: 7 HITs < (GBT -$0.58), ADRO (-$0.02), FIXX (-$0.29), CLBS (-$0.02) SOLD into strength with profit: CLLS (-$0.27), CRSP (+$0.15), NTLA (+$0.46) and 2 MISS < (FATE -$0.18), (RENE.L -$11.50)
Q4 and FY 19 results: Caladrius Biosciences (CLBS)
Short-term investment is always about a SELL/BUY moment in time; in the near and long-term, it will be a process which doesn’t always earn a ROI
The Dow closed DOWN -969.58 points (-3.58%), the S&P closed DOWN -106.18 points (-3.39%) while the NASDAQ closed DOWN -279.49 points (-3.10%)
Indexes plunged on Thursday, erasing most of the gains in the previous session, as markets remained highly volatile in the face of the fast-spreading coronavirus.
Fears about the coronavirus disrupting the global economy continued to grip Wall Street as countries around the world extended quarantines and travel restrictions. California declared a state of emergency after a coronavirus-related death and 53 confirmed cases in the state. The number of infections in New York also doubled overnight to 22 as the state ramps up its testing. <CNBC>
The CBOE Volatility Index (VIX) jumped +23.85% while the Healthcare Select Sector SPDR Fund (XLV -2.32%), Nasdaq Biotechnology NBI (-1.70%) and the iShares Russell 2000 ETF (IWM -3.58%) dived.
From my Data Docket, “Thursday’s weekly jobless claims data underscored the labor market strength despite the outbreak. Initial claims for state unemployment benefits slipped 3,000 to 216,000 for the week ended Feb. 29. Economists had forecast claims would fall to 215,000 in the latest week.”
Investors will monitor a key jobs report on Friday for signs of any negative impact on the labor market from the coronavirus.
Orchestrating the battle of the today’s run to being oversold versus yesterday’s overbought.
The strongest uptrends do not get oversold, or fall to relative strength index (RSI) levels below 30. In fact, the strongest uptrends often stay above the 40-50 level and constantly print overbought readings above 70.
Are we at a “tradeable bottom (?); it depends on whether electronic machine-oriented trading “rules” will resist further selling?
The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:
- Thursday, the IBB closed down -2.12% and XBI closed down -1.59%
- Wednesday, the IBB closed up +4.69% and XBI closed up +4.70%
- Tuesday, the IBB closed down -2.67% and XBI closed down -2.84%
- Monday, the IBB closed up +5.54% and XBI closed up +3.54%
The advance/decline line scenario of 35 covered companies:
- Thursday, the close was negative with an A/D line of 11/24, 0 flats of 35 covered;
- Wednesday, the close was positive with an A/D line of 30/3, 2 flats of 35 covered;
- Tuesday, the close was negative with an A/D line of 7/26, 2 flats of 35 covered;
- Monday, the close was positive with an A/D line of 24/11, 0 flat of 35 covered;
Thursday’s (highest 5) incliners:
- Editas Medicine (EDIT +$2.14);
- uniQure NV (QURE +$2.00);
- Regenxbio (RGNX +$0.69 after Wednesday’s +$2.39);
- Brainstorm cell therapy (BCLI +$0.66);
- Intellia Therapeutics (NTLA +$0.46);
Thursday’s (lowest 5) decliners:
- ReNeuron (-$11.50);
- Sage Therapeutics (SAGE -$2.63);
- Ultragenyx (RARE -$2.08);
- Ionis Pharmaceuticals (IONS -$1.67 after Wednesday’s +$3.87);
- bluebird bio (BLUE -$1.010;
The percentage (%) indicators:
- Thursday’s the range of the 11-upside was +0.25% (BSTG) to +9.48% (BCLI) while the 24-downside ranged from -0.11% (BLCM) to -9.09% (RENE.L);
- Wednesday’s the range of the 30-upside was +0.31% (SLDB) to +9.85% (GBT) while the 3-downside ranged from -0.42% (CLBS) to -17.7% (BSTG);
- Tuesday’s the range of the 7-upside was +0.60% (NTLA) to +18.52% (BSTG) while the 26-downside ranged from -0.04% (MESO) to -17.14% (PGEN);
- Monday’s the range of the 24-upside was +1.6% (ATHX) to +13.53% (SAGE) while the 11-downside ranged from -0.327% (ADRO) to -8.30% (RENE.L);
Upside volume stats: to compare
- Thursday: 4 out of the 11-upside had higher than the 3-month average volume;
- Wednesday: 5 out of the 30-upside had higher than the 3-month average volume;
- Tuesday: 4 out of the 7-upside had higher than the 3-month average volume;
- Monday: 12 out of the 24-upside had higher than the 3-month average volume;
Downside volume stats:
- Thursday: 5 out of the 24-downside had higher than the 3-month average volume;
- Wednesday: 2 out of the 3-downside had higher than the 3-month average volume;
- Tuesday: 10 out of the 26-downside had higher than the 3-month average volume;
- Monday: 6 out of the 11-downside had higher than the 3-month average volume;
- Sangamo Therapeutics (SGMO +$0.40 with 5.225 M shares traded after Wednesday’s -$0.12 with 3.615 M shares traded (3-month average = 1.989 M shares);
- Verastem Oncology (VSTM +$0.07 with 2.247 M shares traded after Wednesday’s +$0.04 with 2.408 M shares traded (3-month average = 2.53 M shares);
- Precigen (PGEN) -$0.28 with 1.035 M shares traded (3-month average =1.072 M shares);
- Aduro Biotechnologies (ADRO -$0.02 with 750,129 shares traded (3-month average =1.337 M shares);
Thursday closed negative with 24 decliners, 11 advancers and 2 flats
Wednesday closed positive with 3 decliners, 30 advancers and 2 flats
Tuesday closed negative with 26 decliners, 7 advancers and 2 flats
Monday closed positive with 11 decliners, 24 advancers and 0 flats
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.