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When a strong sector drops without a fundamental reason, my radar goes up. That’s exactly what’s happening in Health Care (XLV) — and it’s caught my full attention.
Over the past month, the sector’s fallen about 10%, sliding from roughly $171 to $156. There’s been no meaningful catalyst to justify that kind of move.
That disconnect — when price action doesn’t match underlying strength — is exactly where I start paying close attention. Because when technical setups, seasonal trends and discounted valuations line up, you often get the kind of opportunity that doesn’t appear often.
Eli Lilly Looks Like a Long-Term Winner
One name stands out: Eli Lilly (LLY). I’ve said before that this could be a monster stock over the next five to 10 years, and right now it’s trading at what I consider an attractive discount.
This isn’t about chasing a bounce. It’s about positioning early in a company with long-term tailwinds that’s now trading below last month’s levels. And LLY isn’t alone.
When multiple names in the same sector start aligning, that’s sector-wide strength — not random noise. It’s one of the clearest signs that a coordinated sector rebound may be forming beneath the surface.
Health Care also has favorable seasonality behind it right now, and its relative strength has been gaining steam. That combination often marks a period when high-quality names tend to outperform, making the timing especially interesting.
Technical Signals Are Beginning to Turn
The technical picture is getting compelling. My Magic Momentum Indicator — which tracks early momentum shifts — is starting to curl higher, literally popping in a way we haven’t seen in a while. Overall momentum remains red, but that early turn is the kind of subtle shift I watch closely.
It’s an early signal, not a guarantee of an immediate move, but it tells me conditions may be changing faster than they appear on the surface.
And it’s not just LLY. Pfizer (PFE) recently turned positive on the Newton scanner, showing a clean chart and a steady uptrend. When multiple names inside the same sector begin showing similar constructive setups, that’s usually the beginning of broader sector strength rather than isolated noise.
If you’re looking for a sector with favorable seasonality, improving technicals and high-quality names trading at lower prices than they were weeks ago, Health Care is at the top of my list right now. It checks a lot of boxes, and I’m paying close attention.
Graham Lindman
Graham Lindman Trading
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P.S. See How These Cheap Dollar Options Work
Trump might not even reopen the Strait of Hormuz…
Oil’s still climbing and the Iran situation could drag on another four to six weeks.
And the market is doing exactly what you’d expect… chopping around with no real direction.
Most traders are stuck right now… waiting for a breakout… waiting for someone to tell them it’s safe to trade again.
I’m not waiting. In fact, I’ll be live at 1 p.m. ET today!
Because here’s what I keep seeing…
The market doesn’t need to pick a direction for you to get paid right now… It really doesn’t.
Some of the best trades I’ve been putting on lately are on stocks that are doing almost nothing… flat… sideways and boring.
And I’m using options that only cost about a dollar to get into.
No big breakout needed. No guessing where oil goes next or what Trump says tomorrow.
These “Dollar Options” work precisely because the stock isn’t moving.
And with this much uncertainty hanging over the market… that could be the setup for weeks to come.
As you already know, while I cannot guarantee returns or against losses…
I’ll walk through exactly how I’m finding these trades, what I’m looking at today, and why this stretch of market could be one of the best we’ve seen for this approach.
