XBI shows steady momentum as it continues building its larger bullish cycle. However, the ETF still trades inside wave I, which keeps the door open for a deeper pullback. Because of this, traders should expect volatility to increase as the structure matures. Moreover, the next months may reveal whether buyers can defend key support levels.
Even so, the broader trend remains constructive while the cycle stays incomplete. As wave II develops, price could create a healthier base for the next advance. After that, a confirmed reaction higher would strengthen the bullish outlook. Therefore, traders should monitor the sequence closely and adapt as the structure unfolds.
Elliott Wave Structure: XBI Weekly Chart February 14th 2026
Back in February, we believed the impulse from the extreme zone had already reached 132.00 before pulling back toward 122.88. That advance delivered a gain above 62%, so we thought wave I likely ended at that stage. Yes, price could still print a marginal high above 132, but caution made more sense then. Besides, we expected choppy action until the market revealed a clear direction.
When that move appeared, we anticipated the first break to point lower. We projected a double correction as wave II, although any corrective pattern remained possible. Even a sharp drop could unfold before the bullish trend resumed. At that time, we anticipated a correction toward the 107–91 zone. That area looked promising for new buying opportunities and the next rally in wave III.
If you’re eager to dive deeper into Elliott Wave Theory and learn how its principles apply to market forecasting, you might find these resources helpful: Elliott Wave Education and Elliott Wave Theory.
Elliott Wave Principle Behind the Market Structure
Impulse
An impulse is a clean 5‑wave pattern that drives the trend forward.
- Waves 1‑3‑5 are strong and directional.
- No overlap between waves 1 and 4.
- Wave 3 is usually the strongest.
- Structure is clear, with increasing momentum.
Elliott Wave Structure: XBI Weekly Chart June 1st 2026
XBI currently shows lagging momentum, which suggests the correction should appear soon. However, only a strong bullish move would invalidate this view. Therefore, we expect wave I to complete a leading diagonal with one more high, possibly near 142.60. If price shows a strong bearish reaction at that level, we will consider wave I completed and the expected correction underway.
If we do not see that bearish reaction and price keeps lagging, we cannot rule out additional upside. Even so, the structure still favors a pending correction before the next bullish phase.
Source: https://elliottwave-forecast.com/stock-market/xbi-momentum-fades-as-wave-i-nears-completion/