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Chart of the Week – Intermarket Relationships: SPDR S&P Biotech ETF (XBI)

Asbury Research

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Asbury Research
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By:

CMT Chief Market Strategist

TURNING NEAR TO INTERMEDIATE TERM BEARISH

The chart below shows that XBI collapsed on Friday below the lower boundary of almost 5 months of sideways investor indecision from the April high.  This suggests an emerging major bearish trend change and targets an additional 13% decline to 69.50 that will remain valid below the 80.91 area. 

XBI has maintained a very tight and stable statistical correlation to the S&P 500 (SPX) at various intervals over the past decade.

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