{"id":4683,"date":"2016-09-15T12:46:04","date_gmt":"2016-09-15T16:46:04","guid":{"rendered":"http:\/\/www.morpheustrading.com\/blog\/?p=4683"},"modified":"2016-10-02T14:19:57","modified_gmt":"2016-10-02T18:19:57","slug":"stock-picks-ibb-pypl","status":"publish","type":"post","link":"https:\/\/morpheustrading.com\/blog\/stock-picks-ibb-pypl\/","title":{"rendered":"Stock Picks: Biotech ETF &#038; PayPal Are Stocks To Buy Now ($IBB $PYPL)"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"alignright size-medium wp-image-4687\" src=\"https:\/\/www.morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/biotechnology-300x126.jpg\" alt=\"biotech-etf\" width=\"300\" height=\"126\" title=\"\" srcset=\"https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/biotechnology-300x126.jpg 300w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/biotechnology-110x46.jpg 110w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/biotechnology-768x323.jpg 768w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/biotechnology-1024x430.jpg 1024w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/>As the stock market tries to gain traction after recently pulling back, a bit of caution may be a good idea.<\/p>\n<p>Breakout stocks are still\u00a0<a href=\"https:\/\/www.morpheustrading.com\/images\/twd-091516.png\" target=\"_blank\">holding up well<\/a> for us, but breakouts have a higher failure rate when the major indices are in correction mode.<\/p>\n<p>As such, we&#8217;ve been expanding our radar to hone in on bullish trend reversal setups as well.<\/p>\n<p>One such swing trade setup is iShares Biotech ETF ($IBB), which is now on our internal stock pick watchlist for potential buy entry.<\/p>\n<p>Continue reading for our analysis on why now may be the time to buy $IBB.<\/p>\n<p>After that, I&#8217;ll show you why I think PayPal ($PYPL) is one of the top stock picks right now.<\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">TABLE OF CONTENTS<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/morpheustrading.com\/blog\/stock-picks-ibb-pypl\/#iShares_NASDAQ_Biotech_ETF_%E2%80%93_IBB\" >iShares NASDAQ Biotech ETF &#8211; $IBB<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/morpheustrading.com\/blog\/stock-picks-ibb-pypl\/#Healthy_Correction\" >Healthy Correction<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/morpheustrading.com\/blog\/stock-picks-ibb-pypl\/#Bullish_Confirmation\" >Bullish Confirmation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/morpheustrading.com\/blog\/stock-picks-ibb-pypl\/#The_Play\" >The Play<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/morpheustrading.com\/blog\/stock-picks-ibb-pypl\/#Why_PayPal_May_Pay_Off_PYPL\" >Why PayPal\u00a0May Pay Off ($PYPL)<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/morpheustrading.com\/blog\/stock-picks-ibb-pypl\/#Its_Relatively_Simple\" >It&#8217;s Relatively Simple<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/morpheustrading.com\/blog\/stock-picks-ibb-pypl\/#The_Play-2\" >The Play<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h3><span class=\"ez-toc-section\" id=\"iShares_NASDAQ_Biotech_ETF_%E2%80%93_IBB\"><\/span><strong>iShares NASDAQ Biotech ETF &#8211; $IBB<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The annotated weekly chart of $IBB below shows the bullish trend reversal setup (my technical analysis of the setup follows):<\/p>\n<figure style=\"width: 914px\" class=\"wp-caption alignnone\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/160915IBB.png\" alt=\"$IBB WEEKLY \" width=\"914\" height=\"777\" title=\"\"><figcaption class=\"wp-caption-text\">iShares NASDAQ Biotech ETF ($IBB)<\/figcaption><\/figure>\n<p>After finding long-term support at the rising 200-week moving average (200-week MA) \u00a0earlier this year, Biotech ETF ($IBB) rallied above resistance of\u00a0a year-long downtrend line in late July.<\/p>\n<p>That move also correlated to a breakout above the 40-week MA (similar to the 200-day MA).<\/p>\n<p>Note the big <strong>bullish reversal candle<\/strong> in early <span class=\"__postbox-detected-content __postbox-detected-date\">July<\/span> that sparked a five-week rally of the lows.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Healthy_Correction\"><\/span><strong>Healthy Correction<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>$IBB pulled back\u00a0after bumping into the $300 mark, but has since been building a solid base of support, above the 40-week MA, for the past six weeks.<\/p>\n<p>The base of consolidation that followed the 5-week rally is bullish, especially considering the ETF only retraced about 1\/3 of its\u00a0recent gains.<\/p>\n<p>Now, $IBB has found a new, <strong>higher level of support.<\/strong><\/p>\n<h4><span class=\"ez-toc-section\" id=\"Bullish_Confirmation\"><\/span><strong>Bullish Confirmation<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><span class=\"__postbox-detected-content __postbox-detected-date\">Confirming the bullish picture is the\u00a010-week<\/span> MA, which is now in a clear\u00a0uptrend and recently crossed above the <span class=\"__postbox-detected-content __postbox-detected-date\">40-week<\/span> MA.<\/p>\n<p>That crossover is a bullish signal of intermediate-term <strong>trend reversal\u00a0<\/strong>as well.<\/p>\n<p>The longer-term\u00a040-week MA is still trending lower, but has flattened out quite a bit.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"The_Play\"><\/span><strong>The Play<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>In the coming days, look for\u00a0$IBB to start rallying off its 40-week MA support, which should lead to new swing highs above the $300 level.<\/p>\n<p>A protective stop could be neatly placed below the low of the past four-weeks of support ($274 area gives it some &#8220;wiggle room&#8221;).<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Why_PayPal_May_Pay_Off_PYPL\"><\/span><strong>Why PayPal\u00a0May Pay Off ($PYPL)<img loading=\"lazy\" decoding=\"async\" class=\"alignright wp-image-4690\" src=\"https:\/\/www.morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/paypal-logo.png\" alt=\"paypal-pypl\" width=\"190\" height=\"190\" title=\"\" srcset=\"https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/paypal-logo-110x110.png 110w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/paypal-logo-120x120.png 120w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/paypal-logo-144x144.png 144w, https:\/\/morpheustrading.com\/blog\/wp-content\/uploads\/2016\/09\/paypal-logo-50x50.png 50w\" sizes=\"auto, (max-width: 190px) 100vw, 190px\" \/><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>We continue to build our watchlist as the market settles in\u00a0after last week&#8217;s selloff.<\/p>\n<p>$SIMO, $GIMO, $GDDY, $TEAM, and $PYPL are just a few candidates from our <a href=\"https:\/\/www.morpheustrading.com\/services\/swing-trade-alerts\" target=\"_blank\"><em>Wagner Daily<\/em><\/a> buy watchlist.<\/p>\n<p>Of these, we particularly like $PYPL and the chart below shows why it may be back in play with bullish momentum.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Its_Relatively_Simple\"><\/span><strong>It&#8217;s Relatively Simple<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>$PYPL has\u00a0shown great relative strength this week, after basing out above the <span class=\"__postbox-detected-content __postbox-detected-date\">40-week<\/span> MA for roughly six weeks in <span class=\"__postbox-detected-content __postbox-detected-date\">July<\/span> and <span class=\"__postbox-detected-content __postbox-detected-date\">August.<\/span><\/p>\n<p>While most stocks have sold off since last <span class=\"__postbox-detected-content __postbox-detected-date\">Friday,<\/span> $PYPL broke through last week&#8217;s high on a pick up in volume.<\/p>\n<p>If a stock is so strong that it moves higher while the broad market sells off, that&#8217;s the power of\u00a0relative strength!<\/p>\n<p>Relative strength enables a stock to rocket higher\u00a0when the broad market starts moving\u00a0higher; these are my favorite types of\u00a0stocks to buy.<\/p>\n<p>Check out the relative strength on the weekly chart of $PYPL below:<\/p>\n<p><img decoding=\"async\" src=\"https:\/\/www.morpheustrading.com\/\/%7Erick\/\/charts\/2014\/160915PYPL.png\" alt=\"$pypl WEEKLY \" title=\"\"><\/p>\n<p>In addition to the relative strength, both the 10 and 40-week MAs have been trending higher for the past several weeks.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"The_Play-2\"><\/span><strong>The Play<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>There is quite a bit of resistance in the $40 &#8211; $41 area, which may or may not take some time to work through depending on market conditions.<\/p>\n<p>There is also the possibility that the price remains in a tight range until earnings in late <span class=\"__postbox-detected-content __postbox-detected-date\">October.<\/span><\/p>\n<p>But if PayPal breaks out to a new 52-week high (above the $41 area), substantial trading profits may\u00a0be made on this momentum trade.<\/p>\n<p>Of course, it would be a good plan to keep a stop a few percent below the breakout level, just to cut the losses quickly if the breakout fails.<\/p>\n<p>Whether or not such a breakout succeeds will largely be determined by the strength of the overall broad market, which is driven by leading stocks.<\/p>\n<p>Either way, $IBB carries quite a favorable reward-risk ratio, and $PYPL sure isn&#8217;t bad either.<\/p>\n<p><em>What do you think about these swing trade setups? Share your thoughts below.<\/em><\/p>\n<p><script async src=\"\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js\"><\/script><br \/>\n<!-- Auto size --><br \/>\n<ins class=\"adsbygoogle\"\n     style=\"display:block\"\n     data-ad-client=\"ca-pub-7565144363001883\"\n     data-ad-slot=\"7670585366\"\n     data-ad-format=\"auto\"><\/ins><br \/>\n<script>\n(adsbygoogle = window.adsbygoogle || []).push({});\n<\/script><\/p>\n","protected":false},"excerpt":{"rendered":"<p>As the stock market tries to gain traction after recently pulling back, a bit of caution may be a good idea. Breakout stocks are still\u00a0holding up well for us, but breakouts have a higher failure rate when the major indices are in correction mode. As such, we&#8217;ve been expanding our radar to hone in on [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[5],"tags":[],"class_list":["post-4683","post","type-post","status-publish","format-standard","hentry","category-stock-picks-analysis"],"_links":{"self":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/4683","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/comments?post=4683"}],"version-history":[{"count":0,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/4683\/revisions"}],"wp:attachment":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/media?parent=4683"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/categories?post=4683"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/tags?post=4683"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}