Pharma and BioTech Sentiment Compressing

By | April 9, 2015

I’m starting to see compression in sentiment in some of the major Pharma and Biotech stocks. When sentiment and momentum compress in a triangle it represents an inflection point for the stock. The direction of the break either creates a buy signal or a warning of more consolidation ahead. Below are some example charts. Here’s a detail example of a buy signal for Apple (AAPL) for those of you who are unfamiliar with our trading method.

Pfizer (PFE) is and example. You can watch for a break of the triangle in the coming days here.

150409pfe

The triangle in Biogen (BIIB) isn’t quite as defined so you should watch is as a stock that is potentially warning. If it breaks below the uptrend in 7 day momentum it will indicate more consolidation is needed before the stock (and possibly the sector) can move higher. You can track Twitter sentiment for Biogen here.

150409biib

Twitter momentum for the Biotech ETF (IBB) is still warning. It had a negative divergence with price and is still in a clear down trend. Bulls want to see the downtrend in momentum broken. Here’s the IBB chart.

150409ibb

You can see the full list of pharma stocks here and the a partial list of biotech stocks with Twitter sentiment here.

 

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