UNH (NYSE: UNH) broke the support, will continue to fall?
As we have seen in the chart, we had a short support (Yellow Line) with 5 confirmations (Green Circles) for 5 months that broke today, with the value of UNH shares falling well below what is expected for today.
The fundamental question here is to know if the value of the stock will continue to fall, until when it will continue to fall or if it begins to recover, we will analyze this through three points:
We could conclude then that the value of the shares of UNH will go up sooner rather than later, we should analyze then because there was such a sharp drop in the value of the shares of UNH, to explain this we should analyze the supports and the rebounds that had each one of the supports:
If we see the stronger support (Orange Line) we see that it is more stable, we say this because in 23 months he only had 4 rebounds separate by long periods of time. At the short support (Yellow Line) we have 5 rebounds in just 5 months, this is because the slope is tilted more, which makes it a less stable support that ends up breaking when the rate of rise can not be maintained.
Then we can conclude that the stock price will rise again, probably at a lower rate than what it was doing, although it may return to the previous rate.
I thank you very much for your reading and I am open to criticism and questions!
I´m sorry about my english, I try to translate al my analysis from the US and Argentinien market into english.
Regards!
The fundamental question here is to know if the value of the stock will continue to fall, until when it will continue to fall or if it begins to recover, we will analyze this through three points:
- Although the shortest support we had was broken, we must bear in mind that there is another stronger support (Orange Line) that is ready to stop the fall of UNH shares with 4 confirmations (Orange Circles) during the period of 23 months. .
This assures us that although the value of the stock may continue to fall, when approaching the stronger support it is more likely that the fall will be slowed down.
- We have to bear in mind that the fall of today was slowed down to the height of the last bounce (horizontal green line) of the minor support, which coincides with S5 yellow. What gives rise to the possibility that tomorrow the price of the stock does not continue to fall, it should rebound.
- Finally we have to know that the shares of the company UNH are undervalued if we apply a fundamental analysis, so, in the long term the value of the shares of this company will tend to rise.
We could conclude then that the value of the shares of UNH will go up sooner rather than later, we should analyze then because there was such a sharp drop in the value of the shares of UNH, to explain this we should analyze the supports and the rebounds that had each one of the supports:
If we see the stronger support (Orange Line) we see that it is more stable, we say this because in 23 months he only had 4 rebounds separate by long periods of time. At the short support (Yellow Line) we have 5 rebounds in just 5 months, this is because the slope is tilted more, which makes it a less stable support that ends up breaking when the rate of rise can not be maintained.
Then we can conclude that the stock price will rise again, probably at a lower rate than what it was doing, although it may return to the previous rate.
I thank you very much for your reading and I am open to criticism and questions!
I´m sorry about my english, I try to translate al my analysis from the US and Argentinien market into english.
Regards!