30 thoughts on “CHART OF THE DAY – BBH

    1. Gary Post author

      If you are asking me is it a good time to buy and hold for the next year, then yes I think so.

      If you are asking me if you can buy today and XBI won’t be down tomorrow, I’ll have to admit that I can’t time perfect entries. If you are day trading I’m not the one to go to for advice, I’ve never been able to beat the machines at the day trading game.

  1. MuffinTop

    And I would like to kindly remind everyone to STOP OVER-TRADING!!

    There’s a time and place for scalping but when certain sectors hint at a major rebound, then your job is to get in closest to the bottom, sit tight and let it play out — Patience and flexibility is key with these types of Markets 🙂

  2. ralph rodriguez

    Thanks Gary.. It’s hard for investor and traders to
    Make the CONTRARIAN move against the crowd. Most of The greatest fortunes in the world were made by Contrarians..

    1. Trader Cee

      And a whole lot of fortunes were lost by contrarians too. We celebrate the ones who got it right and made fortunes but for each one of those that timed it right there are hundreds more that just became statistics and fodder for the machine.

    1. Gary Post author

      Well LABU is a leveraged fund and those have decay. So you will need to exit close to the top of the intermediate cycle. That could still be 10+ weeks away.

      1. Trader Cee

        And that Gary is why it is better to buy actual companies than just the fund. You may ride up a brief gain alright but if Biotech does embark on a bull market you will get left behind and likely be unwilling to chase stocks as they keep rising. Why not just choose a selection from LABU instead that look the most promising.

        1. Gary Post author

          I never buy individual companies. It opens one up to company specific risk. Like VRX

  3. pepe le pew

    Gary, with a 3x leveraged instrument like LABU, would it not be more prudent to exit as close to the daily cycle top as possible, and then buy as close to the DCL as possible? I ask because of the decay. Or is that too much attempting to time a non-exact cycle science?

    1. Gary Post author

      Biotech may not follow stocks for a while as it comes out of this bear market bottom.

  4. MuffinTop

    And also.. I agree that if Sentiment is rather extreme then perhaps a Stop Loss is ill advised but I would argue against Gary that a Stop-Loss and a Trailing Stop Loss {in combination with Position Sizing} is in fact a ‘must’ depending on your trading strategy.

    A Stop Loss has saved my Ass on several occasions.. because no matter what, a stock and/or an ETF can drop longer and harder than anticipated regardless of Cycle Count, Elliot Waves, Fib Retracement, Gann Angles and all that other fancy stuff.. And I would in fact much rather take 3 small losses and buy in at the bottom for a 100% gain, then leave my account in the red for an over extended period of time. That’s just me.

    If you’re not Technically inclined then a ‘Trailing Stop Loss’ is a must so that you can lock in your profits if and when the trend changes direction.

    But more importantly.. a Stop Loss and a Trailing Stop Loss takes the emotion {and Ego} out of trading and helps solidify your trading strategy and discipline, which a lot of you should spend a bit more time on. Discipline is in fact how you’re gonna make and continue to make money trading — that’s where it starts. If you don’t have discipline then you’ll fck up and fck up again, curl up in a ball, and be too scared to pull the trigger when the right opportunity comes knocking at your front door 🙂

  5. Ralph Wiederzane

    I still haven’t bought my intended XBI position, but congratulations to Gary once again, he’s on a serious hot streak so I won’t be surprised if this one gets away from me. If the biotechs can open lower tomorrow I will start my buying and plan to hold the length of the IC.

  6. Jacob 2

    Little double bottoms on both BIB and LABU. Should get exciting once LABU breaks 8 ( i know ill be).

  7. Walt

    That BBH chart you have above looks like a textbook head and shoulders. , with your yellow highlight the 2nd shoulder . You may be right though . We’ll see.

  8. joseph

    Interesting point…. based on seasonality…..
    The past 50 years, when large-cap index become stretched, that its 6% or higher above 50-day which it is now , and over 3% above 20-day….. After 30 – 60 days, the S&P was lower 80% of the time for a loss of 3%%
    Minimum correction is 30-60pts do you at 1980

    VIX broke support but PUT to Call Ratio rose……

    1. Gary Post author

      We will get a corrective move down into a DCL soon, but my current expectation isn’t for the cycle to top for another 5-10 days yet.

      1. Jacob 2

        Fund managers missed this rally. They Should now be on board till then end of the quarter playing catch up. Most were expecting a weak market ( 1600 …. That’s what all the TA gurus were saying) for the 1st half of the year followed by a strong finish. Thinking maybe it will be just the opposite.

  9. j

    Not saying youre right or wrong but
    1. A one day break in a 10 day trendline is hard to call a long term reversal,
    2. How can you really call this the bottom of a bubble phase?

    And where do you see OIL from here? Just curious on your opinion.

    1. Gary Post author

      It’s the bottom of the correction following the first leg up in a long term bull market. Nothing about that rally qualifies as a bubble. It didn’t stretch 50%+ above the 200 day moving average, It didn’t rally more than 100% in a year or less and the public never piled into the sector.

      That wasn’t even close to a bubble.

  10. Dan

    Funny how YOU think you are some kind of guru when every trader goes through hot and cold streaks. Sick of reading your condescending garbage. You’ll just go on a cold streak and blame manipulation. What a joke.

    Oh, and terrorist attacks are just so super bullish right?

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