Health Care Stocks Ain’t Nationalized…

So what if our Health Care System is under fire by a President who is worse than that of James Buchanan (Pennsylvania represent)? There is no reason to rationalize your Health Care sector stocks, as the sector is currently in a neutral flag technical pattern that needs volume for a substantial breakout. Yesterday afternoon, I wrote a post describing my love affair for XLV, and my opinion has not changed from this post by any means.

Energy Select SPDR ETF (XLE) and Materials Select SPDR ETF (XLB) will be discussed Friday morning via “The Micro Take” on Davian Letter. This morning on MJTT, we’ll be concentrating on a couple of micro cap tickers out of the Health Care sector that present interesting speculative and swing trades going into the latter of this week. First, let’s review the Health Care Select SPDR ETF (XLV) chart with Wednesday’s final hours of trading involved:

XLV 9 Month, Daily As seen in the chart above, the neutral flag is evident and is looking to breakout big time (testing the waters with the slight push above 28.16 into the close) - More volume accumulation is necessary to breakout in my opinion.

Technically, XLV has looked strong since the March bottom and has flagged on several occasions, only to breakout and make a move higher each time. In my opinion, Thursday is the biggest day of the week for XLV, as it will either breakout and go higher or cool down and continue to consolidate within its neutral flag.

With the technicals of XLV in mind, let’s check out a couple of micro setups that look promising going into today and Friday:

VICL 9 Month, Daily (Swing Trade): The bull flag continues, but the strength of the Health Care sector and some volume accumulation out of VICL should allow it to breakout.

CYTR 6 Month, Daily (Swing Trade): Found substantial support at 0.86, volume accumulation was weak yesterday - 1.05 still short term price target. [DISCLAIMER: I have a position in CYTR]

INCY 9 Month, Daily (Speculative Trade): Ascending triangle price pattern breakout on Monday of this week, Bump ‘N’ Run setup from Tuesday action (restest of 6.03 price as support), and finally a big price gain yesterday - Will look at today’s action for guidance as to where to go from here.

BCRX 3 Month, Daily (Swing Trade): Good volume accumulation this week, looking for a breakout about the descending trend line resistance from the wedge price pattern - 20d SMA and ascending trend line acting as solid support levels.

ARIA 9 Month, Daily (Speculative Trade): Developing bull flag but being held in check by the 20d SMA - Wait another day to see if ARIA completes the 2-Day Bull Flag Swing by testing the 2.00 price level on low volume distribution.

THC 1 Year, Daily (Speculative Trade): Very similar to ARIA, watching for the 2-Day Bull Flag Swing to initiate during today’s action - if no breakout occurs, watch for a continued low volume distribution price decline.

SPPI 9 Month, Daily (Swing Trade): Retesting 6.00 price level as a support, watching volume and the 50d SMA to give me a “tell” as to when SPPI may be in for a big move.

OCLS 9 Month, Daily (Speculative Trade): Similar to ARIA and THC, waiting to see a high price/low volume distribution decline in OCLS to confirm the 2-Day Bull Flag Swing - Held 20d SMA and descending trend line resistance quite well, looking for 5d SMA to cross above 10d SMA to indicate some type of momentum pop.

Keep your eye on the following things with the tickers above and you will successfully be able to initiate some winning trades from the Health Care sector:

• Volume
• The 2-Day Bull Flag Swing
• 5d/10d SMA Momentum Indicator
• Support/Resistance levels

Good luck with today’s trading session!

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