The top-five holdings in the iShares Nasdaq Biotechnology ETF (IBB) represent some 42% of the exchange-traded fund. These are Celgene (CELG), Amgen (AMGN), Gilead (GILD), Regeneron (REGN) and Action Alerts PLUS holding Biogen (BIIB).
All five of these stocks show a similar technical setup that points to an upside move in the IBB soon.
The common thread in these five names is the bullish divergence between the lower lows in price and the higher low in the momentum study.
We also see improvement in the On-Balance-Volume line. The slowing decline in prices and a more positive price and volume movement can foreshadow a rally. Several names are close to rallying above their respective 50-day moving averages.
In this chart above from Parallax Financial Research, the spikes indicate days when AMGN could have a trend change.
The large spike for Oct. 16 suggests that a significant move up or down could be seen for AMGN. With our other technical indicators suggesting an upside move, we'll be on alert this Friday for a rally.