Healthcare & Biotech Stocks: A Big Opportunity In 2023

One of the areas that will come with opportunities for stock market investors in 2023 is the health care sector. This includes pharma, medical devices, biotech, and the likes. This is one of our 2023 forecasts that complements the market findings from our Dow Jones 100 year chart analysis.

It might feel that the bottom is not set. However, we are on record predicting that a lasting bottom is set, particularly on June 17th and October 13th, 2022.

IF our forecast is true, it means that NOW is the time to accumulate quality stocks. Most of them are beaten down and trade at very attractive valuations.

One of the sectors that is visibly entering a bullish momentum period: health & biotech. Yes, healthcare stocks look good, you might not have noticed it which is why it’s attractive from a contrarian perspective.

This is how what we wrote in our Momentum Investing alert “10 hidden gems with a buy signal” which we sent premium members:

One of the largest stocks in health is Gilead Sciences (GILD). Below is its weekly chart since 2012. It has a bullish reversal, a textbook one, a really perfect setup. GILD went up 20% last week which is really exceptional for this trendless stock. What stands out is the massive cash position of this company. We added key valuation and financial metrics on our charts in this alert. The P/C ratio (price/cash) is elevated. A large cash position is rewarded by the market currently!

You may consider Gilead Sciences a leading indicator for the health sector.

(Click on image to enlarge)

gilead stock chart

Note that the biotech sector chart looks absolutely gorgeous and very powerful (bullish).

Biotech and healthcare stocks come with opportunity. It is clear from the sector charts and the leading indicators like GILD.

However, there is also risk. Especially the biotech space is full of risk. You better be selective in the biotech space.

Here is one tip that might help to mitigate risk: stocks with a large cash position are currently rewarded by the market.

Here is another tip: bullish chart reversals.

With bullish chart reversals on the health & biotech sector charts, with a high confidence in our market bottom forecast, with the risk mitigation factor to look for stocks with high cash positions (P/C ratio) we believe it should be sufficiently clear how and where to look for opportunities.

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