Updated from 11:43 a.m. EDTThe biotechnology sector has been rocketing higher in recent weeks, as investors have bid up the shares of both speculative names and established companies in the group. And according to some observers, the ride's not over yet. On Wednesday morning, Merrill Lynch and Credit Suisse First Boston issued positive research notes, saying there's even more upside for biotech. Merrill pointed out that the Amex Biotech Index rose 67% from its intraday low on March 12 to its intraday high on June 6. That climb was followed by profit-taking, which led to what the firm called a modest selloff. But analysts now believe the biotech measure is ready to resume its ascent. The firm said that money flow into mutual funds has improved, while new stock issuance has remained minimal. Other positives Merrill cited include a more accommodating Food and Drug Administration and the belief that the recent string of upbeat news should continue. "Valuations remain well within the historical range, and window dressing into the end of the quarter should bode well for biotechs," Merrill said. Merrill, as other analysts have indicated, said the FDA seems to be approving products faster, particularly those that treat life-threatening diseases. Additionally, the firm said that positive news surrounding several products, including Genentech's ( DNA) Avastin, a proposed treatment for cancer, has increased interest in the biotech group.