The biotech bounce is far from over, says one technician, who sees another jump in the charts for the previously embattled group.
Examining a long-term chart of the popular IBB ETF, Evercore ISI technician Rich Ross points out that the biotech tracker suffered significant losses from mid-2016 to the end of the year, deeming the pullback "a very tough stretch" for the group. But since then, IBB has shown signs of a bullish rally ahead since it pulled back to its 200-day moving average.
The biotech sector, which Ross says is one of the biggest surprises of 2017, will bounce, according to the technician.
"What at times appeared to be a breakdown from this head-and-shoulders top now appears to be a breakout from a 14-month base of support," Ross said Wednesday on CNBC's "Trading Nation." "You're flirting with the $300 level."
In other words, IBB's 200-day moving average, which currently is at $278.66, is now acting as a support level from which the ETF could jump, in Ross's view.
"You can see this bullish base of support here at the tail end, once again, of this 35 percent decline here," added Ross. "That sets the stage for biotech to continue to move higher. I would be a buyer of the IBB."
On Wednesday, IBB rose nearly 1 percent, regaining most of its losses after dropping on Tuesday after a Donald Trump tweet on drug pricing and the introduction of a new health-care bill.