June 16, 2020 7:41am

Limited your downside and protect your upside by taking profits as available; Q2 slowly cruises to an end as investors grow more concerned with COVID-19 possible re-emergence

Pre-open indications: 1 BUY and 7 SELLs

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There’s a lot of RISK still out there, SELL into strength

Dow futures are UP +1.82% (+462 points), S&P futures are UP +1.26% (+39 points) and NASDAQ futures are UP +1.15% (+113 points)

 

Futures tied to the major U.S. stock indexes rose sharply on words of President Trump’s administration preparing a $1 trillion infrastructure proposal;

  • the Trump administration is drawing up a $1 trillion infrastructure proposal. The report said a preliminary version being prepared would set aside the majority of the money for traditional infrastructure projects such as roads and bridges, though funds would also be reserved for 5G wireless infrastructure and rural broadband.

European stocks rallied, as the previous day’s worries over the spreading coronavirus outbreaks succumbed to optimism over central bank support as the German DAX (DAX, 2.73%), French (CAC 40 PX1, 2.22%) and U.K. (FTSE UKX, 2.42%) bounced back.

Asia Pacific stocks jumped as all regional markets jumped with the MSCI Asia ex-Japan index gaining 2.59%.

 

Data docket: consumer spending activity as well as industrial production and business inventories data

 

Henry’omics:

Futures implied an opening gain of more than 450 points when regular trading resumes. S&P 500 and Nasdaq-100 futures were both higher as well.

From the title, “An island reversal is a price pattern on bar charts or candlestick charts that, on a daily chart, features a grouping of days separated on either side by gaps in the price action. This price pattern suggests that prices may reverse whatever trend they are currently exhibiting, whether from upward to downward or from downward to upward.”

The moves early Tuesday followed a striking rebound in U.S. equity markets a day earlier.

 

Monday’s post’s title: “an impressive comeback for the sector; the RegMed/Cell and Gene therapy sector rallied after a negative open.”

  • The NASDAQ closed UP +137.21 points (+1.43%);
  • The IBB closed +1.99% and XBI also closed up +2.82%;
  • Monday opened negative and closed positive;
  • Sector volume continued LOW with 7 out of the 28-upside having higher than the 3-month average volume and 1 out of the 5-downside having higher than the 3-month average volume;
  • Monday’s percentage (%) of the 28-upside were +0.67% (SLDB) to +17.36% (BCLI) while the 5-downside ranged from -0.09% (SGMO) to -3.85% (RENE.L); 

Q2:

  • June registered 5 positive and 6 negative closes
  • May registered 9 negative, 11 positive closes and 1 holiday.
  • April registered 10 negative, 11 positive closes and 1 holiday.

Q1:

  • March registered 11 negative, 10 positive closes and 1 neutral close.
  • February registered 9 negative, 9 positive closes, 3 vacation days and 1 holiday.
  • January registered 9 negative, 10 positive closes and 2 holidays.

 

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

SELL into Strength:

  • Precigen (PGEN) closed up +$0.35 to $4.49 and has a negative -$0.04 and -0.89% aftermarket indication;
  • Adverum Biotechnologies (ADVM) closed up +$2.39 to $23.70 and has NO aftermarket indication;
  • Athersys (ATHX) closed up +$0.36 to $3.20 and has a negative -$0.08 or -2.50% aftermarket indication;
  • Brainstorm Cell Therapeutics (BCLI) closed up +$1.47 to $9.94 and has NO aftermarket indication;
  • Editas medicine (EDIT) closed up +$1.95 to $28.94 and has a positive +0.16 or +0.55% aftermarket indication;
  • Fate Therapeutics (FATE closed up +$1.16 to $31.91 and has a negative -$0.13 or -0.41 aftermarket indication;
  • uniQure NV (QURE) closed up +$2.12 to $65.24 and has a negative -$0.18 or -0.27% aftermarket indication;

BUY:

  • CRISPR Therapeutics (CRSP) closed up +$2.56 and has a positive +$0.85 or +1.365 aftermarket indication;

 

The BOTTOM LINE: Again, from the title “Island reversals are a peculiar identifier because they are defined by price gaps on either side of a grouping of trading periods (usually days).”

This price pattern occurs when two different gaps isolate a cluster of trading days. The pattern usually implies reversal and can apply to a bullish or bearish change. An island reversal changing from upward trending prices (bullish) to downward trending prices (bearish) is much more frequent than the opposite.

Watch the volatile gaps that emerge from these patterns. Gap patterns occur when a significant difference in price is shown from one session to the next.

And, DON’T always BUY the emerging dips – Q2 results are … c o m I n g!

 

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.