Biotech stocks have lagged recently, as the Nasdaq biotech ETF, the IBB, has declined for three-straight sessions and is down more than 10 percent from its October high.



On a technical level, the group's charts concern Miller Tabak equity strategist Matt Maley. Here's why:



• On Wednesday, the ETF broke below its 200-day moving average, which has proven solid support for the IBB for much of 2017. This is a red flag for the stocks into year-end and into 2018.

• The IBB has rallied nearly 16 percent this year but began pulling back in October. This raised concern that it could see a decline akin to the one in 2015 amid political uncertainty around drug pricing.



• Two more key levels Maley is watching are 105.5, which was the IBB's high in early November and early December, and 101.5, which is the low touched in August and November. A break below 101.5 would be quite bearish for the IBB.



Bottom line: Biotech stocks just broke below their 200-day moving average, which could have negative implications for the group.