XBI (SPDR Biotech ETF) is in Our Technical Crosshairs this Week for a Significant Secondary Low Within a Major Bottoming Scenario
by Mike Paulenoff
May 11, 2025 • 8:56 AM EDT
On April 22, 2025, I posted the following analysis about my technical setup work in XBI (SPDR S&P Biotech ETF):
XBI (SPDR S&P Biotech ETF)-- Could it be? Could it be that the near-40% correction from the 11/11/24 multi-year high at 105.47 to the 4/09/25 low at 66.66 fully discounted all the bad news in this sector? From a BIG Picture perspective, my attached Daily Chart shows this month's spike low into the vicinity of the previous major corrective low-zone starting in May 2022. In addition, the April 2025 low at 66.66 coincides with a 360 trading day low-to-low cyclical periodicity that appears to be right on schedule. Lastly, my hourly pattern work (not shown here) indicates that the rally from the 4/09/25 low at 66.66 to today's high at 7780 exhibits bullish form, and as such is precisely the type of price behavior a prospect XBI bull wants to see after a major corrective low. Bottom Line: My near and intermediate-term technical work argues that the 4/07/25 low at 66.66 represents the first coordinate in a developing very significant and powerful bottom in XBI. In a "perfect entry scenario," I am looking to enter XBI at 70-72 if able in the days ahead, with stops placed 1% beneath the April low... Last is 77.36...
Fast-forward almost three weeks, we see (on my attached Daily Chart) that the initial XBI upmove from the 4/07/25 corrective and cyclical low at 66.66 peaked at 84.21 (+26%) on 5/02/25. Since then-- all of last week, XBI has been in the grasp of a pullback that has retraced about 50% of the prior upmove.
My near-term pattern work argues that XBI still has some unfinished business to the downside into the 74 to 71 support window (amended from my original support/pivot window of 70 to 72), where I will be expecting renewed buying interest to pivot the price structure to the upside, leaving behind a "stepped-up" secondary low within a potentially powerful cyclical bottom formation.
As long as any acute weakness is contained above the April 2025 low-zone from 70 down to 66.66, XBI's post-April technical setup is progressing according to a potentially extremely bullish scenario that argues for a climb above the May high at 84.21 to challenge and hurdle the down-sloping 200 DMA, now 92.42...
XBI will be on my radar screen in the hours and days directly ahead... Last (5/09/25 Close): 76.39...
Mike Paulenoff is the author of MPTrader.com, a real-time diary of his technical analysis & trade alerts
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