UnitedHealth Group (UNH) shares slid in latest buying and selling Thursday after tumbling Wednesday amid worries about potential cuts to Medicare, and a report accusing the corporate of paying secret bonuses to nursing houses.

Including to pressures going through the embattled medical insurance big and others within the sector, the Facilities for Medicare & Medicaid Providers stated it plans a «significant expansion» of its auditing efforts for Medicare Benefit plans.

Since reaching their April excessive, UnitedHealth shares have misplaced about half their worth, weighed down by a number of challenges—together with a Justice Division investigation of the heath insurer for Medicare fraud, its CEO’s abrupt departure, and the corporate’s withdrawal of its full-year steerage.

Beneath, we take a better have a look at UnitedHealth’s weekly chart and use technical analysis to determine key value ranges after the inventory’s latest volatility.

Headstone Doji Emerges

Since UnitedHealth’s countertrend rally resulted in early April, the inventory moved decrease for 5 consecutive weeks, coinciding with the relative strength It’s index (RSI) sliding into oversold territory. 

The inventory rallied earlier this week, however has since pared most of these beneficial properties to kind a gravestone doji. Whereas chart watchers usually affiliate it as a bearish candlestick pattern, a headstone doji can even point out a bullish reversal, particularly if it emerges after an prolonged downtrend, akin to on UnitedHealth’s chart.

It’s price declaring that trading volume has surged over the previous two weeks, probably signaling capitulation promoting, an occasion that may mark the tip of a steep decline.

Beneath, we determine a number of key support and resistance ranges on UnitedHealth’s chart that might be price watching.

Key Assist Ranges to Watch

First, it’s price watching the $292 stage. The shares might discover assist on this space close to final week’s shut, which additionally intently aligns with a spread or corresponding price action on the chart between late 2019 and mid-2020.

A decisive shut beneath this key technical stage might see the shares revisit decrease assist round $249. Discount hunters could search for long-term shopping for alternatives on this location close to a sequence of buying and selling exercise on the chart from early 2018 to March 2020.

Essential Resistance Ranges to Monitor

Preliminary restoration efforts within the inventory might meet resistance on the $325 stage. Tactical merchants searching for to capitalize on short-term value swings could place promote orders close to this week’s excessive, which roughly aligns with the August 2020 peak and February 2021 trough.

A extra bullish reversal might even see UnitedHealth shares make a transfer towards $365. This space might present overhead resistance close to two outstanding peaks that shaped on the chart in November 2020 and January 2021 throughout a long-term uptrend within the inventory.

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As of the date this text was written, the writer doesn’t personal any of the above securities.