As the biotech sector has rebounded in the last few days, the Direction Daily S&P Biotech Bear 3X Shares ($LABD) has seen a sharp pullback. But technicals suggest that LABD is set for a rebound.
As the daily price chart shows, LABD has seen a series of lower lows over the past week. The stock’s 50-day moving average also recently crossed below the 200-day moving average, forming what technical traders describe as a “death cross.” A death cross is seen as a sell signal and we did see some selling in LABD after that. But the fund seems to have found support at around $35 from where it has bounced back sharply in trading today.