News of the runaway gaps in Nasdaq, S&P 500 and the Dow, hit the interplanetary airwaves.

Hovering above the earth in their space dinghy, a family of extraterrestrials are looking for a soft landing.

It does seem though, that their navigation system is a bit off. Instead of landing near Wall Street, the ETs are headed straight for Beverly Hills. After all, that’s a good destination when your investments lead to a windfall and you believe you have money to burn.

That brings me to the question that lots of folks have right now–

Is this runaway gap the start of a new parabolic leg up, or is this the blow-off rally that sucks in the aliens and the Johnny-come-lately buyers?

A great sector to measure speculative interest is the big pharma or Biotechnology (IBB). We call Biotech Big Brother.

While IBB posted its all-time high in July 2015 (133.60), here we are 3 years later, and today, IBB finally made a new 2018 high at 121.80.

With today’s impressive rally, we can deduce a few conclusions about the late buyers.

First, they are late.

Secondly, maybe they are not late.

With a huge amount of headroom for IBB to get anywhere near the 2015 highs, perhaps many more speculators will see IBB as comparatively cheap.

We can look for rotation into that sector next week.

On the other hand, IBB has a way of sucking in the last to buy and the last to sell. In other words, a contrarian indicator.

Putting some numbers on that, IBB cleared 120.06, the last swing high from late July. That makes the 120 price area pivotal, or a good spot to hold on a closing basis.

Should 120 fail, 118 is the next best underlying support level.

On the monthly chart, 122.19 was IBB’s last-ditch attempt to rally in 2015 before the humongous sell-off.

Using that number as one to clear, if IBB can do so, then get ready for some green folks coming to a neighborhood near you.

S&P 500 (SPY) Working off the runaway gap. 289.37 is a good spot to hold. It does, do I hear 300?