3 Biotechnology Plays to Consider With Fed Rate Cut Looming
As the Federal Reserve prepares to boost the market with a rate cut, we're looking at this handful of promising names.
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The market action feels a little hungover on Monday morning. Breadth is running very slightly positive due to outperformance by the Russell 2000 (IWM) , but pockets of momentum are narrow, and the Magnificent Seven is struggling, down 0.7%.
Investors are likely looking ahead to the Fed’s interest rate decision on Wednesday afternoon and contemplating some "sell the news" action. There has been a very good run starting on the Monday before Thanksgiving, and some consolidation is needed before the Fed news hits.
I increased my cash levels last week and am currently at around 25%. I’m looking for some very good trading opportunities after the Fed news and as pressure builds for a Santa Claus rally. I want to stay flexible and move quickly.
My top group for aggressive trading remains biotechnology. It is one of my favorite sectors to trade because the stocks tend to be volatile and make big moves. Trading skill is rewarded in the sector.
There is an interesting move in the group today with Structure Therapeutics (GPCR) more than doubling after news that its weight-loss drug, in the exploratory ACCESS II study, achieved a placebo-adjusted mean weight loss up to 15.3% with a 240 MG dose at 36 weeks. Other stocks in the group are down on that news.
Another stock in the group I’m buying primarily on a technical basis, because I like the charts and the high price targets, is Alto Neurosciences (ANRO). The company has a strong pipeline with a focus on high-prevalence psychiatric conditions where existing treatments often work poorly, such as major depressive disorder (MDD), post-traumatic stress disorder (PTSD) and cognitive impairment associated with depression and other disorders.
I’m in ANRO for a trade but will likely build a core position.
A third biotech name on my radar is a longer-term investment. ABIVAX Societe Anonyme (ABVX) is a clinical-stage biotechnology company headquartered in Paris, France, with a U.S. office in Waltham, Massachusetts. Its primary focus is on inflammatory bowel disease (IBD), ulcerative colitis (UC) and Crohn’s disease (CD). The company’s lead drug candidate is Obefazimod (also known as ABX464), an oral, once-daily therapy.
What makes Obefazimod unique is its mechanism of operation. ABIVAX describes it as the first molecule designed to enhance microRNA-124 (miR-124), which is a natural regulator of inflammatory signaling. In simple terms, the drug is intended to help “normalize” inflammatory pathways rather than bludgeon the immune system into submission.
In July, ABIVAX reported positive Phase 3 results from two eight-week UC induction studies that met the FDA primary endpoint of clinical remission at week eight. In biotech terms, this is a meaningful “de-risking” event because it moves the debate from “does the drug work at all?” to “how durable is it, what does safety look like over time and how does it compete commercially?”
ABIVAX is positioning Obefazimod as a differentiated, orally administered, once-daily option. If longer-duration data support a strong benefit/risk profile, that combination can translate into real-world adoption potential in a huge market. ABIVAX has also initiated development for Crohn’s disease and expects data in 2H 2026.
According to TheFly.com, recent analyst coverage includes Truist with a Buy rating and a $140 target on November 24, 2025. Barclays with an Overweight and $142 target on October 13, 2025, and Wolfe Research with an Outperform and $176 target (early November 2025).
Technically, the stock pulled back recently from a high of $130 to support around $110. The $110 mark is the key level currently, and we are using that as our initial threshold for the trade. ABIVAX is an attractive setup because it has both a credible clinical narrative that can re-rate in stages, combined with a chart that offers a clean way to define risk. With ABVX holding support near $110, we look to structure the position around an objective technical “line in the sand,” rather than relying on hope or headline-chasing. As always, we are looking to aggressively trade the stock as the chart develops.
Many other interesting opportunities are developing once the Fed is out of the way and the path is cleared for a visit from Santa.
At the time of publication, DePorre was long ABVX and ANRO.
