NEW DIRECTIONAL CALL PLAYS
UnitedHealth Group Inc - UNH - close 31.90 change -0.13 stop 30.35
UnitedHealth Group Incorporated is a diversified health and well-being company. The Company operates in four business segments: Health Benefits, which includes UnitedHealthcare, Ovations and AmeriChoice; OptumHealth; Ingenix and Prescription Solutions. On June 1, 2009, the Company completed the acquisition of AIM Healthcare Services, Inc. (AIM). In March 2010, the Company acquired QualityMetric Incorporated.
Target(s): 33.40, 34.25, 35.00
Key Support/Resistance Areas: 35.00, 34.40, 33.50, 31.50,
Time Frame: 1 to 2 weeks
Why We Like It:
UNH is a relative strength play in a defensive sector that should do well in the current market environment. Technically, UNH recently broke out of a key pivot level near $31.50 and has retraced some the gains by turning back to re-test the pivot from above (see dashed line on chart), which is where the stock bounced today. UNH is above all of its major moving averages and is maintaining an upward trend line from the 7/1 lows. I think UNH is poised to retest its recent swing highs and possibly move up towards the $35.00 area. I suggest we initiate long positions now. Our stop is below all of the major moving averages which should provide support on any weakness, and we have realistic targets to book a nice winning trade should UNH bounce from here.
Suggested Position: Buy September $32.00 CALL, current ask is $1.10
Entry on August xx
Earnings Date 10/19/2010 (unconfirmed)
Average Daily Volume: 8.5 million
Listed on August 16, 2010