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If I wanted (which I do not) I could trade IBB, in and out, with week's long swing trades. The reason I don't is I prefer the volatility of singular names comprising the biotech sector.

At this moment, the IBB chart shows a Japanese candlestick from yesterday which suggests a bottom is hammered out. In fact, this particular candlestick is called a "hammer."

That said, IBB is the symbol for the iShares Nasdaq Biotechnology Sector which is one of the more heavily traded sectors in daytrader and swing trader books.

Yesterday, 1,463,802 shares traded hands. IBB closed the day up at .05% on that "hammer".

Things I like about this chart suggesting that we may have a bounce in biotech names starting tomorrow:

1. The hammer candlestick.

2. Trading at the bottom of a discernible channel I have drawn on my chart.

3. Closed the day above the 50 EMA (green line on chart).

4. Won't take much to close above the 20 EMA (red line on chart) either today or tomorrow.

5. Note the 20 EMA is above the 50 EMA, and the 50 EMA is above the 200 EMA. This means the mid-term and long-term look at this chart is bullish.

6. 8 trading days ago we hit the all-time high on the IBB chart. (I will use ath or ATH in future posts as an acronym for "att-time high.")

7. Last study on the chart, at the bottom, is the chaikan money flow indicator. Just know, when it is green, it means more institutions are buying big blocks than selling. Right now, the CMF (Chaikan Money Flow) Indicator is showing institutional buying is picking up in this new base area.

8. In my view, this is time to buy some individual biotech names seeking FDA milestones within 2 or more weeks and which are not within 2 weeks of their next earnings reports.

http://schrts.co/3UdRNk
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