The iShares Nasdaq Biotechnology (IBB) Overcomes Its First Bash

The iShares Nasdaq Biotechnology (IBB) suffered three important “bashes” starting in September, 2015 when Secretary of State Hillary Clinton promised to end price gouging by drug makers. Since then, a similar promise in August created a fresh top in IBB and a bash by Senator Bernie Sanders created a breakdown below 200-day moving average (DMA) support.


The iShares Nasdaq Biotechnology (IBB) broke out anew thanks to a Clinton loss in the U.S. Presidential election.
The iShares Nasdaq Biotechnology (IBB) broke out anew thanks to a Clinton loss in the U.S. Presidential election.

Source: FreeStockCharts.com

A Donald Trump victory in the U.S. Presidential election breathed new life into the sagging ETF. The chart above shows that IBB gapped above resistance at BOTH the 50 and 200-day moving averages (DMAs). IBB closed with a whopping 8.9% gain.

Perhaps most importantly IBB finally overcame a bash. The Bernie Bash is now in the rear view mirror. Assuming the 50DMA now holds as support, I foresee a quick test of Clinton Bash two around $300. Unless a triple top is in IBB’s future, a fresh rally should challenge the levels from the first Clinton Bash. This trade is one of many Trump-related trades now on my radar…

Full disclosure: no positions

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