Despite the market turning lower today with the S&P 500 down over 1% and the Nasdaq 100 down closer to 3% thanks to weakness in AI names, there are plenty of pockets of green. In fact, S&P 500 breadth is positive on the day, and one of the top performing sectors with a 1%+ gain is Health Care. A part of that is a breakout in Biotech stocks.
Using the iShares Biotech ETF (IBB) as a proxy for the space, as shown below, the group repeatedly ran into resistance in the high $170 range from January through February of this year. It then fluctuated around its 50-DMA, more recently finding support at its still upward trending 200-DMA before breaking out to the upside with fresh 52-week highs today.
Perhaps more importantly, today's breakout for IBB doesn't only mark a breakout relative to the past several months' range, but it also just took out all-time highs last made in late 2021.
Now that IBB has finally broken through the clouds and cleared turbulence, will it now be clear skies ahead for IBB?
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