Chart of the day: IBB

Today’s stock chart of the day is Biotechnology ETF IBB. The pulled back hard taking a number of hot biotech stocks down with it.

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The fact that IBB pulled back hard is a concern for the market since it has been leading the market.

However, the stock is sitting right at they key 50 day moving average level. This could lead to a small reflex bounce even if it does break the support level and start a downtrend. An entry here offers an easily manageable trade with low risk, high reward.

If taking a stab here, make sure to manage risk with a stop under the moving average and a target that gives you a 2:1 reward to risk ratio.

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