Healthcare stocks were down big on Tuesday, after Amazon (AMZN), JP Morgan Chase (JPM), and Berkshire Hathaway (BRK) announced a collaboration to form a new healthcare company to service their employees.
“The ballooning costs of (health care) act as a hungry tapeworm on the American economy,” explained Warren Buffet, CEO of Berkshire.
The venture appears to be in the early stages, and as such they have not provided details. However, some investors believe that there may be potential to cause some disruption in the healthcare sector.
The Health Care Select Sector SPDR Fund (XLV) was down 2% on Tuesday morning.
Taking the worst of it, Express Scripts (ESRX) was down as much as 9%. Our cycle analysis shows that a top appears to have formed in ESRX, with a decline due into April and a target of $70 or below.
The market cycles on the charts below are designated by the purple semicircles at the bottom of the chart.
ESRX Stock Chart (Weekly Bars)
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