Stock

Sell CVS Health for a chance to buy at these potential levels

CVS Health Corporation (NYSE:CVS) stock consolidated at the key level of around $110, signaling that it was time to exit. The healthcare solutions company has returned a negative 7% year-to-date. It should be noted that the loss in the year comes at the back of a strong rally throughout 2021. The stock rose from a low of around $72 in January 2021 to top $110 at the start of this year. 

Evidently, CVS Health’s weakness can be attributed to profit-taking after the stock hit the key resistance of above $110. The weakness is bound to continue as the stock faces imminent pressure after breaking below the consolidation zone.

On Wall Street, CVS has a hold rating at Deutsche Bank with a price target of $110, which the stock has already hit. The rating is a downgrade from the previous buy recommendation by the bank. Some other analysts, including Raymond James, have a higher target of $120. However, we remain less optimistic the stock will rise to $120 in the short-term as weaknesses persist. Consequently, investors could be looking to cut positions.

CVS retreats after hitting resistance

Source – TradingView

Technically, CVS is coming down from an overbought level of $110 when the RSI was 78. The current weakness is bound to continue, with an established support zone around $70-$80. The stock could also settle at around $90 and begin a bullish reversal from there. The quarter results on May 04 could trigger the rise from $90 if results beat estimates. We still maintain the stock could fall to $70-$80, the established support.

Summary

Investors should sell CVS Health stock ahead of earnings and buy lower. The stock could fall up to $70-80, the key support zone. If earnings beat estimates, the stock could reverse around $90.

The post Sell CVS Health for a chance to buy at these potential levels appeared first on Invezz.

Disclaimer: MonopolyWinnersUpdates.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 MonopolyWinnersUpdates.com. All Rights Reserved.

To Top