Healthcare is the latest of the American Sectors to break out to new all-time highs. I think Financials are next, but for today's conversation, let's focus on the task at hand: Healthcare is a space we want to own.
First of all, here is that breakout. It rarely gets cleaner than this:
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Another 35% of upside in this sector would be consistent with historical moves in the past and would be perfectly normal, as far as I'm concerned.
The bigger question, really, is which industry group is going to be the main driver?
The obvious choice appears to be Medical Devices. When all these stocks and sectors were churning sideways since early 2018, the relative strength was already here. You can't deny that. Look at this beauty:
We incorporate a top/down approach here at All Star Charts. By the time we decide that we want to own a particular stock, 95% of the reasons we want to own it have little to do with the chart of that stock itself. It's really more about the other 4,999 charts we look at the direct us to a particular group, and then ultimately to the individual stock.
That's when we come up with the ideas that provide the best risk vs reward opportunities to express a given thesis. Here's my list with specific risk levels and upside targets:
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