Happy Monday! 

Just a friendly reminder for my members that I will be on vacation from tomorrow until next week, but don’t worry, I won’t leave you hanging! I’ll still be sharing ideas and case studies for the Penny Pro and Biotech Breakouts while I am away.

Last week was a week to forget for the biotech bulls. I say that because last week, the XBI closed down 3.65%.

If you need a quick refresher, the XBI is the SPDR S&P 500 Biotech ETF that tracks small-cap biotech companies.

I find it essential to keep tabs on the XBI as it might affect or influence the overall strength of the trend in small-cap biotech companies.

Currently, the XBI is trading in a higher time frame consolidation, between $135 and $120.

After failing to hold above the 20d and 50d MA, the XBI now risks failing to hold above critical support.

For this week, I will focus on whether the XBI can hold above $120 support and push back higher towards resistance or if it breaks below support.

This morning I shared exclusive content with members. I posted my Biotech Breakout November 22 – 26 Weekly Watch List, outlining new ideas for the week and continuation plays.

I want to share two stocks from that Watch List with you all today: OPK and BLU.

BELLUS Health (BLU)

According to Yahoo, BLU is a clinical-stage biopharmaceutical company that develops therapeutics to treat chronic cough and other hypersensitization disorders.

Market Cap: 475.57M

Float: 70.96M

Short Interest: 4.26%

Recent News: 

• BELLUS Health Reports Third Quarter 2021 Financial Results and Business Highlights
• BELLUS Health to Participate in Two Upcoming Healthcare Investor Conferences     

I am watching BLU as long as the stock can continue to hold over $6. 

If price action firms above $6, I might look to get long with a stop around $5.50 and a target of $7.50 – $8. 

I like the setup on the daily chart, as the stock is forming a nice consolidation and has displayed some relative strength to the XBI.

$7.50 – $8 would be my target as the stock failed on multiple attempts to clear that area of resistance.

OPKO Health (OPK)

According to Yahoo, OPK is a healthcare company that engages in the diagnostics and pharmaceuticals businesses in the United States, Ireland, Chile, Spain, Israel, Mexico, and internationally.

Market Cap: 2.94B

Float: 410.71M

Short Interest: 11.74%

OPK has set up well on the daily chart after breaking out of a long-term consolidation at the beginning of November.

After breaking out, the stock has held over previous resistance, thereby turning it into support. 

From now on, I will be watching the stock closely over $4 and might enter for a long position.

I will be targeting $5 – $5.50, and my stop area would be $3.70.