Karma is on Hold for Pharma

Against the backdrop of a pill-popping population and pill-peddling physicians more than toeing the line over the Hippocratic Oath, it felt so right and righteous to see the pharma stocks mostly get clobbered in recent quarters. 

On a nightly basis for Members since late-2015, we were consistently bearish the likes of MNK NBIX HZNP VRX, among others.

That posture enabled us to avoid trouble in this group, as many bottom-fishing longs were pummeled at virtually each and every bounce which merely set up the next leg down. 

Nonetheless, given the surge in biotech this week, some of these pharmas like VRX are playing along impressive. 

Moreover, a chart like MCK looks to be further along technically than its buddies. On the MCK daily chart, below, note how price has held admirably back over its 200-day moving average, a feat not yet accomplished by HZNP MNK VRX. Mckesson now looks to be a much-improved chart and long setup if $160 continues to hold as newfound support. 

Given the buy volume and consistent buying pressure this week in biotech, essentially ignoring overbought conditions, the rally may just be getting started in IBB XBI. And the pharmas may very well continue to play along in a supporting role.

Karma for the pharmas is now back on hold, if only for summer vacation.