“Within the Health Care ETF, some of the biggest stocks by market capitalization, including Johnson & Johnson (JNJ) and Pfizer (PFE), show clear peaks and reversals in July. Pfizer, for example, jumped out of a trading range to new 12-year highs on news that it was acquiring a gene therapy company (see Chart 2). However, the next day it fell sharply after announcing better-than-expected second-quarter results — a bearish signal,” reports Michael for Barron’s.

For XLV and rival healthcare ETFs, the good news is that the U.S. economy moving into the late-cycle phase, overall growth may slow and signs of an economic slowdown could pop up. Consequently, investors may also turn to defensive sectors that are less economically sensitive, such as health care.

Both Democratic presidential front runner Hillary Clinton and GOP hopeful Donald Trump support the right for the government to negotiate Medicare drug costs. Additionally, Clinton has previously stated she would tackle “price gouging” from drugmakers if she is elected.

Related: Healthcare ETFs Ready to Rally

“The bottom line is that health care is not the same sector it was when it was leading the market higher. It’s now the weakest sector in 2016, and fresh breakdowns suggest it will remain that way,” according to Barron’s.

For more information on the biotech sector, visit our biotechnology category.