For all of you stock and CFD players out there, Pfizer is one to watch as the dip in PFE is approaching a potential support area in a longer-term uptrend.
Pfizer (PFE) Pullback Approaching Support Area?
Today we’re taking a technical look at Pfizer (PFE) as the stock dips from 2021 highs. The daily chart above shows that PFE dipped with the rest of the broad market in December, sparked by rising Omicron variant fears and broad market fears of central banks speeding up their monetary policy tightening processes due to high inflation conditions. It’s also possible that traders are lightening up on PFE as extremely early data showed Omicron partly escaped Pfizer vaccine protection.
After topping out just under the $56 handle, PFE is now making its way lower, testing the broken previous high ($51.68) and approaching the Fibonacci retracement area. Stochastic is not yet signaling oversold conditions, and with uncertainty still high surrounding the Omicron variant’s potential affect on the globe, there is a possibility of the stock dipping further.
In a scenario where more Omicron data shows that the variant will not be anymore deadly than previous variants and can be managed with current tools, traders may hop back into the stock on this dip. Longer-term, Pfizer likely looks promising as a position play, not only because of its strong fundamental growth highlighted in its latest earnings release, but also likely on the potential of upcoming COVID-19 oral treatment Paxlovid. The company will discuss Paxlovid on December 17th, so that’s a potential market catalyst to watch out for.
For now, we’ll be watching out for a move all the way down to the $46 – $48 range and if we see bullish reversal patterns form there (and if broad risk sentiment leans positive) we’d consider starting work on a potential long position, especially if we get bullish commentary and data from Pfizer on Paxlovid.
What do you guys think? Will PFE dip beyond the previous swing high? Will support form around the Fibs? Or is this just the start of a bigger move lower? Will Paxlovid be a game changer for the company?
Let me know in the comments below, and as always, remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly. Create your own ideas and don’t simply follow what I do.