Biotech Bop:

Could the higher beta names within healthcare be ready to lead again after a slumber that began just one month in 2021? The ratio chart below comparing the XBI to the PPH suggests so. The breakout occurred earlier this month, but the outperformance for biotechs against pharma actually began in mid-May. For those investors who want a mixture of the two groups, the XLV provides that, with the benefit of growth and mature names within. But for those looking to time the biotechs and pharma now may be the time to overweight the former. That is not to take away anything from the PPH (half of its top 10 components are companies that reside in Europe) which is still well ahead of a cup with handle breakout above a 70.57 pivot taken out on 5/7. It is just that the XBI could have a larger runway higher if the momentum if has displayed since keeps going. Monday met a familiar foe in the round 140 number, which it was above all 3 sessions intraday between 4/27-29, but recorded no CLOSES above 140. It was above a 140.98 double bottom pivot, but they only count with a finish above. Watch that number for the next couple weeks to see if it can achieve it.

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