The Direxion Daily Healthcare Bull 3X Shares (NYSE: CURE) gapped up almost 2.52% higher on Monday in response to outbreaks of monkeypox being reported in several western nations.
CURE is a triple leveraged fund that is designed to outperform 72 U.S. companies in the home health care sector. The index includes a variety of companies including biotechnology, pharmaceuticals, health care equipment, supplies and technology developers and suppliers.
Some of the more familiar names in the ETF include Johnson & Johnson (NYSE: JNJ), weighted at 7.03%; Pfizer Inc. (NYSE: NYSE:PFE), weighted at 4.36%; and Thermo Fisher Scientific Inc. (NYSE: NYSE:TMO), weighted at 3.33%.
It should be noted that leveraged ETFs are meant to be used as a trading vehicle as opposed to a long-term investment.
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The CURE Chart: CURE reversed course into an uptrend after printing a bullish double bottom pattern on Feb. 24 and May 12 at the $97.67 level. The uptrend on CURE’s chart was confirmed on May 19, when the ETF printed a higher low at $100.18.
- On Monday, CURE was attempting to work to rise up to print a higher high above the May 17 high of $112.58. Bullish traders and investors will want to see that happen before CURE makes another low, which would negate the uptrend.
- CURE regained the support of the 21-day exponential moving average (EMA) on Monday, which is a positive sign for the bulls. When the ETF prints its last high it rejected the 21-day, which caused CURE to fall over 10% to print its higher low.
- If CURE can remain trading above the 21-day EMA for a period of time, the eight-day EMA will cross above the 21-day, which would give bullish traders more confidence going forward. The 50-day simple moving average (SMA) hasn’t crossed below the 200-day SMA yet, which means CURE has, so far, avoided a death cross from occurring on its chart.
- If CURE closes the trading day near its high-of-day price, it’s likely the ETF will trade higher on Tuesday to print a higher high. If the ETF closes flat or near its low-of-day price, CURE will print a doji candlestick or shooting star candlestick, respectively, which could indicate lower prices are on the horizon.
- CURE has resistance above at $112.71 and $118.60 and support below at $105.30 and $97.67.
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