Biotechnology stocks ($DJUSBT) were the second best performing industry group last week, trailing on renewable energy ($DWCREE). Both groups appear poised to continue their rally based on their longer-term weekly technical outlook. Therefore, it's probably not a bad idea to look at stocks in these groups that pull back to find critical price support levels from where they're likely to continue their push higher. Bluebird Bio (BLUE) had a rough Friday (-5.49%) after a huge advance 60% advance over the three prior weeks. For short-term aggressive traders, keep an eye on the following key levels:
The two green arrows mark what I consider to be the best support levels. On Friday, BLUE's intraday low of 104.90 tested the rising 20 day EMA. That moving average, along with price support near 98 should provide entry points for longs. The initial target would be a gap fill to Thursday's close at 118.50.
Happy trading!
Tom
