Just three more days left of the trading year!

As I said yesterday, there are no signs of this market slowing down or letting up on opportunities.

I am as zoned in as ever before as my watch lists are packed with promising setups.

Over the last two days, the XBI, which tracks small-cap biotechs, has pulled back slightly after putting in a higher high on the daily chart.

Yesterday the XBI closed down 1.7%. Going into year-end, I will be looking for the XBI to put in a higher low in the area of yesterday’s close to $110, which could further confirm a reversal on the daily chart.

Even with the slight selloff and pullback in the XBI yesterday, I still noticed relative strength in two biotech stocks on my watch list and that I have been paying close attention to lately.

Petros Pharmaceuticals (PTPI)

According to Yahoo, PTPI focuses on men’s health therapeutics. The company engages in the commercialization and development of Stendra, an approved PDE-5 inhibitor prescription medication for the treatment of erectile dysfunction (ED).

PTPI is a story of two halves this year. The stock is up 23.89% over half the year but down 11.59% year to date.

More recently, the stock is up 86.12% on the month and 14.41% on the week.

Market Cap: 61.54M

Shares Outstanding: 9.83M

Short Ratio: 0.17

Recent News: PTPI announces closing of $7.5M offering

PTPI, as I mentioned yesterday in the chatroom and on my video recap, has a classic higher high higher low pattern on the daily chart.

The stock also has a double top on the daily chart, at $5.20.

I am watching PTPI for a possible trade on the long side if the stock can break above $4.09 and hold above.

If the stock can break above $4.09, confirm the higher high and hold, I would be targeting mid to high $5s.

OPKO Health (OPK)

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

OPK is a stock that I have covered recently and written about.

Now that the stock has traded over $5 and reached my target levels, the opportunity going forward becomes different, as the setup has changed.

Going forward with OPK, I will look for the higher high, higher low setup to form.

The stock previously consolidated near resistance and broke out above the $4.60 area.

As the stock pulls back, I will be looking for support and a higher low to be placed near this level.

If the stock can find support and continue to uptrend, I might look for a long entry and target low $5s. Therefore, waiting for confirmation and having the necessary patience will be critical as I wait for this setup to form.

Jeff Williams

Jeff Williams is a full-time day trader with over 15 years experience. Thousands of entry-level and experienced traders alike – day-traders and swing-trade small cap stock traders – credit Jeff with guiding them to turning small accounts into big accounts.

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