Biotechs...

The S&P 500 Biotech industry looks like it is about to rally. Viewing the chart above, you will notice that the current price action is above the recent downward trend line from 2003 to 2005. The industry is also in a consistent upward rally since 2002. (BOTH YELLOW TREND LINES)

If corporate earnings remain solid in this group, testing the resistance levels (PURPLE LINES) will be the first test for the rally to continue. Look for the group to hit the 969.33 followed by 1012.71. Downside risk is 816.46 followed by 802.17.

As earnings season is in full swing, the market is reacting very positively on good earnings reports and fairly harshly on bad earnings reports. While this continues, expect the status quo. We still have a huge international issue going on in the Middle East. The Israel-Hezbollah War, Iran and Korean nuclear issue, and possible other fronts are all going to come back into the forefront once this earnings season is over.  ¶ 11:46:00 AM