ChartSmarter Friday Game Plan 1/22/16

Markets giveth and they takeaway. Wednesday the biotech group led, and Thursday after some harsh news delivered to ALKS which was down more than 40%, the sector flopped. In fact healthcare was the only sector to advance Wednesday and Thursday it was the only group to decline. Yes markets are very tough. The IBB surrendered a good chunk of Wednesdays gains today but did record a bullish harami. Below is chart of KITE which we profiled in our Tuesday Game Plan and shows just how volatile members of the sector can be. The lagging energy and materials group led Thursday and bears will say they want to see better action from leadership groups (whats really leading growth related these days). The bulls will say the markets and crude are correlated and a firm oil price could put a short term floor under the major averages. One aspect we did not like was the Nasdaq lagging the S&P 500, with a fractional gain Thursday. For the week headed into Friday however, the Nasdaq is down .4% attempting to put a 3 week losing streak to rest. The S&P 500 is lower by .6% thus far this week. With earnings season well underway now we have seen some nice bifurcation, the semis acting well, and with no surprise the rails slumping. UNP reported Thursday and fell close to 4% although it did reverse to CLOSE near highs for the session. The stock is now 43% off recent 52 week highs. Peer NSC is now 10 and almost 30 handles below the reported interest by CP for a takeover in November.