Yesterday, health insurance stocks experienced a decline, causing CVS Health Corp (NYSE:CVS) to suffer a significant 7.2% drop. Despite a modest recovery today with shares up 0.7% at $74.37, the impact of the news is still being felt. However, this recent pullback has positioned CVS within one standard deviation of its 200-day moving average, which historically implies bullish trends for investors considering buying the dip.
Schaeffer’s Senior Quantitative Analyst Rocky White noted that the equity has seen two similar signals in the past three years, with the stock higher one month later each time, averaging a 3% gain. Additionally, CVS Health stock’s 14-day relative strength index (RSI) of 29.4 indicates that it is in “oversold” territory, which could point to a short-term bounce. Prior to yesterday’s drop, the stock had been on an upward trajectory with only three daily losses since March 14. Year-to-date, CVS is down 5.7%, but these recent indicators suggest a potential rebound in the near future.
