MACRO VIEW: XLV LOOKING GOOD, TESTING 5-YEAR UPTRENDHealth Care SPDR ETF is looking good on long term basis, testing its 5-year uptrend
On long term basis - XLV is trading firmly in 10 year uptrend (above 1st upper standard deviation from 10-year mean), but due to the recent August selloff the price is now testing its 5-year uptrend. If the price holds above the fist upper standard deviation from 5-year mean, the test will be passed, and the price will likely trend upwards from there.
On short term basis - XLF shows no particular trend, it is trading within 1st standard deviations from both 1-year and quarterly means. It is a positive moment, as nothing on the short term stands in the way of long term trends.
XLV trade ideas
XLV ShortYou can thank that little price hiking hedge fund manager and people like Bill Ackman for the Healthcare/Pharmaceutical correction. Looking at the weekly using Fibs as reference points i believe healthcare over the next few months will begin to sell. I have a target of the 1.618 extension of 59.76 and a second target of 53.31. I'm using XLV to short because everything else is too expensive... you can play this through ITM puts or buy a longterm out of the money put at a 62 or 60 strike for next year.
Feel free to leave comments or questions.
-Ryanhasoptions.
WEEK OF 9/28: NON-EARNINGS PLAYS FOR PREMIUM SELLING OPPSAlthough we are starting back into another earnings season, I'm just not all that fond of earnings plays; I prefer the relative boredom of index ETF trades or things like sector SPDR's for the generation of steady income as opposed to flash-in-the-plan earnings plays which are generally binary in nature. They either work out quickly and dirtily or go horribly awry such that you have to devote buying power to managing a tested side post-earnings, potentially for several options cycles going forward.
Since I have a play already going in OIH (current IVR at 66), I'm looking to add either index ETF trades this coming week or, in the alternative, sector ETF trades that are not correlated to what I've already got on in my portfolio and that have sufficiently high IVR so that a premium selling play is attractive.
Looking at the Dough Grid with the drop-down menu set to "TastyTrade", XLV is a possible candidate, with an IVR currently at 62 ... .
POSSIBLE TRADE:
Nov 20th 59/61/72/74 Iron Condor
POP % -- 61%
Max Profit: .61 credit/contract
Buying Power Effect: 1.39/contract
Break-Evens: 60.39/72.61
Delta: -2.36/contract
Notes: The short put side of the setup is placed around the 1 SD; the long side, at the edge of the expected move to the topside for that expiration. Due to the price of the underlying, the spread of the wings is reduced to 2 strikes, although you can certainly expand the width to 3 strikes in order to harvest more credit from the trade. I wouldn't go wider than 3, however. Look to take off the entire setup at 50% max duration.
In all likelihood, the strikes may require a bit of adjustment at NY York open to accommodate overnight, broader index price movement.
S&P Healthcare no longer shinesThis S&P healthcare sector has been in uptrend since 2009, price has been rejected from 68 and upper bollinger band for the past 3 weeks.
RSI is having a downtrend channel, there are still some room for RSI to test underside of channel top, which means price could break 68 and test uptrend channel top at around 69.5
MACD uptrend line has been broken and MACD are retesting the underside of uptrend line.
When both MACD & RSI are rejected correspondingly, we will see funds heading out for other sector.
Healthcare sector reviewAt this time i would suggest doing nothing, we arrived late to the party going long wouldn't be a very good trade. But if we wait we can short the stock at a moment where we'll get easily a 2.80-3 Risk/Reward Ratio (see chart)
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Hope this chart helped you to have a clearer view of the Healthcare sector.
Analysis: Health At Top Of Health? | #XLV $SPDR $AMEX $XLE $XLFTraders,
This new chart is worth heeding, based on the convergence of technical events explained in the chart's insert - I have copied and pasted it, as follows:
"15 FEB 2014 - Price coming to a significant multi-year high nearing a multi-time frame Fib convergences. While these events may represent wild correlations, superimposition of our predictive analysis corroborate the relevance of these levels. Look for negative divergence, failed Fib level attainments, internal weakening in price action or fundamentally upsetting news for a potential contrarian play. Multi-year analysis point to potential support at a target-low, TG-Low = 44.07.
- David Alcindor"
OVERALL:
Directional bias remains at neutral with bearish bias based on above technical convergences.
Cheers,
David Alcindor | 4xQuad
Predictive Analysis & Forecasting
Denver, Colorado, USA
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Disclaimer: All of our analyses are for educational purpose only. The forecasts, analyses and opinions generated herein are not trading recommendations. We trust that you would do your own due diligence first, then seek professional advice from a licensed professional and enter the market at your own perils - David Alcindor - a.k.a.: 4xForecaster | 4xQuad, LLC.
Ruby on Healthcare / $XLV / #tradingviewRuby in learning patience will see that clearing major EMA's is as important as the cluster of original numbers that provide the signal. The patience piece in math is no easy task. But, we are going to try. The door for candidates of the Creator Group for Ruby ends tonight, midnight EST. Sincerely, Beauty