UnitedHealth Group (UNH) has been a strong stock over the past year and is in focus again on Friday.
Shares initially opened lower on the day, but are now up more than 2.25% after the company reported better-than-expected fourth-quarter earnings.
The company posted double-digit revenue and earnings growth as UnitedHealth delivered a top- and bottom-line beat.
The stock has performed quite well over the past year, up more than 7% vs. the S&P 500’s 16% decline in the same span.
In the fourth quarter, UnitedHealth stock hit a multi-month low as the stock market hit a 2022 low. However, the ensuing rebound sent the stock to new all-time highs on Oct. 31.
That said, UnitedHealth has been prone to some sharp declines in the 7% to 10% range over the last few months. Shares endured just such a decline to start off the year.
Trading UnitedHealth Stock on Earnings
Chart courtesy of TrendSpider.com
That aforementioned pullback sent UnitedHealth stock to its 21-month moving average for the first time since 2020. With Friday's rally, shares are reclaiming $500 and the 10-day moving average.
This is a great start for the bulls, as the stock is holding key measures on the higher timeframes. That said, it has a wall of resistance between $515 and $525.
While that’s admittedly a wide range, it's where UnitedHealth stock faces the 50% retracement of the current range, the daily VWAP measure, and the 21-day, 50-day and 200-day moving averages.
If UnitedHealth Group can maintain momentum from here, this zone is obtainable and traders may consider taking some profits near $520.
If it can clear all of these measures though, it opens the door up toward $540 and then resistance in the mid-$550s.
On the downside, bulls would love to see $500 hold as support. If it fails, the recent lows near $485 are back in play, along with the 21-month moving average.
UnitedHealth stock has been outperforming over the last 12 months, but has been struggling so far this year. Shares are down about 5% so far in 2023, including Friday's rally, while the S&P 500 is up about 4%.
So keep that in mind when evaluating this stock.
