Biotech Likes Falling Interest Rates Too:
Of course, we know precious metals enjoy falling yields but biotech does as well. A vast majority of these names rely on financing to keep their businesses afloat. Notice on this PRICE overlap chart how since the 10-year yield started falling in late April the XBI responded with an uptrend (notice the bullish ascending triangle on the bottom of the chart for the XBI against the IBB indicating a healthy appetite in the space). With the big 50-point cut Wednesday this group may be getting the fuel it needs to get over this stickiness to the very round par number. We have been highlighting this on the MONTHLY chart, and one can see why on the chart below which we also posted a few weeks back. It is looking for its first 5-month win streak since 2015, and looking for its second straight MONTHLY CLOSE above the 50 MONTH SMA and back-to-back bullish hammer candles. The WEEKLY chart is attractive too as it could be ready to break above a bullish ascending triangle (notice how at the lows of the pattern is recorded a bullish harami cross (doji week ending 4/26). The daily chart sports an inverse head and shoulders, although they often are spotted near lows, and a move above the 102 neckline here carries a measured move to 113.