Healthcare has been a very reliable sector maintaining its status as a leader over the last year. The XLV looks shaky at the moment down 10% from recent 52 week highs as does the IBB which is 14% off its own recent all time highs. Now may be the time to pause and let the dust settle, but it is by no means a reason to not build a watch list. Names that hold strong during turmoil are often the first name to find a firm footing once that rally resumes. Below we look at 2 names exactly how they were presented in our Monday 8/31 Game Plan.
Stocks that can be bought as they take out their 50 day SMAs and then through valid base structures are CLVS. CLVS is a healthcare play up 44% YTD and 84% over the last one year period. This week put a halt to a 3 week losing streak gaining 10.8% in firm volume recording a bullish engulfing week in the process. Earnings have been inconsistent with 3 losses of 3.2, 1.8 and .4% on 8/7, 5/7 and 11/7 (it rose 1.7% on 2/26). CLVS is currently trading right near a 83.56 cup with handle breakout trigger taken out on 4/13 jumping 13% in a base that began 11 months earlier. It is best viewed on the weekly chart and we know the longer the pattern the better chances of success are. Look to enter with a buy stop above its 50 day SMA at 82.75 and add to through a double bottom trigger of 92.65.