Major market indexes are in a serious slump, with the Nasdaq Composite (COMP) working on a streak of 10 consecutive down days -- assuming there isn't a serious bounce into the close today. This phenomenon hasn't been witnessed since 1989. In times like this, when markets seemingly can't get out of their own way, a stock picker can usually find pockets of strength where capital can be deployed. One such example is currently the biotechnology sector.

The SPDR S&P Biotech ETF (XBI) is an exchange-traded fund that contains a basket of different biotech stocks. Looking at the chart, you will notice that the XBI is near its 52-week highs, even with the S&P 500 Index (SPX) nearly 100 points off its highs of the year. The chart pattern is an inverse head-and-shoulders that appears ready to break to new highs.

A few individual names in that ETF which happen to be favorites here at Schaeffer's are Ariad Pharmaceuticals (ARIA), Amarin Corp. (AMRN), and Pharmacyclics (PCYC). Biotechnology stocks are notorious for making huge moves on news, such as FDA trials or buyouts. If you don't want exposure to one individual name, then XBI is the way to go. If you're looking for a big move, however, find an individual stock within that sector and define your risk.

During shaky times in the markets, it is often best to look at what has been working. These names remain strong, even in the face of the entire European mess. If the broad market can regain some footing in the near future, one would have to think that the names in this sector will break out to new highs.