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Bio-tech Stocks Are Oversold, But They Haven’t Bottomed Yet

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April 07, 2014 – Comments (0) | RELATED TICKERS: IBB , AMGN , GILD

One of the hottest stock sectors in 2013 was the bio-technology stocks. Leading bio-tech stocks such as Celgene Corp (CELG), Gilead Sciences Inc. (GILD), Vertex Pharmaceuticals Incorporated (VRTX), and Amgen Inc (AMGN) were some of the biggest winners last year. So far in 2014, this high growth industry group has been in correction mode. Many of the leading bio-tech stocks are now trading lower by 20.0 percent or more since the start of the new year. While it is safe to say that the bio-tech sector is severely oversold, this important industry group has not yet bottomed out. 

Traders and investors can expect minor bounces in the bio-tech stocks from current levels, but it is not a true bottom in the industry group just yet. Remember nothing in the stock market goes down or up in a straight line. One of the ways that traders and investors can play the entire bio-tech sector is to use and follow the iShares NASDAQ Biotechnology Index ETF (IBB). At this time, the IBB is signaling downside to the $202.00 level. This is an area where the institutional money will likely come back in and support the bio-tech stocks, until then the bounces in the sector are likely to be just small rallies from an oversold condition. 

Nicholas Santiago
InTheMoneyStocks.com

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