Technical Technical Technical

Technical Update - NextGen Medicine ETF's rising from the ashes. More upside potential

Equity 5 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  Our Head of Equity Strategy, Peter Garnry, published this excellent piece https://www.home.saxo/content/articles/equities/nextgen-medicine-basket-and-the-protein-folding-problem-04082022 about Cutting Edge Biotech companies I’ve decided to have a closer look at the three of the four related ETF’s


ARK Genomic Revolution (ARKG) was a massive bubble formed in 2020 only to implode last year. Price reached within a few dollars its pre-bubble price level from 2020. ARKG has bounced 45% and there seems to be more upside potential.
On the weekly chart it formed a Doji Morning star like bottom and reversal formation in June. (circled) . Falling trend line has been broken and the ETF is building an uptrend.

Source: Saxo Group

On the daily chart ARKG gapped higher yesterday and if closing above 39.31 it has confirmed its uptrend.
If instead it closes below 34.57 the uptrend is in jeopardy and if closing below 30.81 it is reversed. First warning of that scenario to play out would be a close below 35.75.
No strong resistance before around 200 weekly SMA. Some resistance at 49.25

Source: Saxo Group

Similar rebound picture on iShares Gold Genomics Immunology & Healthcare ETF, IDNA. The ETF has formed a Doji Evening Star bottom and reversal formation on the weekly chart. Combined with divergence on RSI the rebound picture is clear.
 

Source: Saxo Group

If closing above 33.60 the uptrend has been confirmed. RSI is above support the bullish picture and 21 and 55 SMA’s are on the rise i.e. underlying bullish short- and medium-term trend
Resistance at around $36-37. Strong resistance at around 46. .

Source: Saxo Group

The German listed iShares Healthcare Innovation ETF, 2B78 was not as hard hit last year as the two previously mentioned ETF’s. However, on the weekly chart shows a Hammer followed by a long Bullish Engulfing candle both strongly indicating bottom and reversal.

Source: Saxo Group

iShares Healthcare Innovation ETF has been in an uptrend since early July and has confirmed it with a higher close yesterday. However, RSI is falling i.e. divergence indicating we could see a correction back below the 200 SMA before uptrend is likely to resume. If RSI breaks above its falling trendline it is a strong indication of uptrend to resume
Strong resistance at 7.28. 

Source: Saxo Group
Disclaimer

Saxo Capital Markets (Australia) Limited prepares and distributes information/research produced within the Saxo Bank Group for informational purposes only. In addition to the disclaimer below, if any general advice is provided, such advice does not take into account your individual objectives, financial situation or needs. You should consider the appropriateness of trading any financial instrument as trading can result in losses that exceed your initial investment. Please refer to our Analysis Disclaimer, and our Financial Services Guide and Product Disclosure Statement. All legal documentation and disclaimers can be found at https://www.home.saxo/en-au/legal/.

The Saxo Bank Group entities each provide execution-only service. Access and use of Saxo News & Research and any Saxo Bank Group website are subject to (i) the Terms of Use; (ii) the full Disclaimer; and (iii) the Risk Warning in addition (where relevant) to the terms governing the use of the website of a member of the Saxo Bank Group.

Saxo News & Research is provided for informational purposes, does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. No Saxo Bank Group entity shall be liable for any losses that you may sustain as a result of any investment decision made in reliance on information on Saxo News & Research.

To the extent that any content is construed as investment research, such content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments.Saxo Capital Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Capital Markets or its affiliates.

Please read our disclaimers:
- Full Disclaimer (https://www.home.saxo/en-au/legal/disclaimer/saxo-disclaimer)
- Analysis Disclaimer (https://www.home.saxo/en-au/legal/analysis-disclaimer/saxo-analysis-disclaimer)
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)

Saxo Capital Markets (Australia) Limited
Suite 1, Level 14, 9 Castlereagh St
Sydney NSW 2000
Australia

Contact Saxo

Select region

Australia
Australia

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-au/about-us/awards

Saxo Capital Markets (Australia) Limited ABN 32 110 128 286 AFSL 280372 (‘Saxo’ or ‘Saxo Capital Markets’) is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms, Financial Services Guide, Product Disclosure Statement and Target Market Determination to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Saxo Capital Markets does not provide ‘personal’ financial product advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Capital Markets does not take into account an individual’s needs, objectives or financial situation. The Target Market Determination should assist you in determining whether any of the products or services we offer are likely to be consistent with your objectives, financial situation and needs.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc.

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website is not intended for residents of the United States and Japan.

Please click here to view our full disclaimer.