Technical Analyst, Saxo Bank Group
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.
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
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.
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. .
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.
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.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
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