Healthcare stocks (XLV) have been underperforming the benchmark S&P 500 for the past 4-5 months, but they're beginning to show some life as the XLV has been the best performing sector ETF over the last week. Recently, I noticed pharmaceuticals testing a major price support level and they've begun to bounce, rising 4.52% over the past week. Next up appears to be the Dow Jones U.S. Medical Supplies Index ($DJUSMS). Their one week gain has been a more modest 2.35%, but check out the bullish technical developments on the chart:
Today's close has cleared wedge resistance near 720, but keep in mind these are weekly candles and we still have one more trading day to finish out this week. It appears to me that the DJUSMS is heading back to 750 to test the high established back in July and that's another 4% or so higher.
Happy trading!
Tom
