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Buy, Sell or Avoid Moderna After the Earnings? Here's the Chart

Moderna was crushed after its earnings report but has recovered most of its losses. Here's what the charts suggest from here.

Like many other stocks on Thursday, Moderna  (MRNA) - Get Moderna Inc. Report shares are lower after the vaccine producer reported earnings.

But down 2.5% on the day is much better than the earlier action. Moderna opened 9.1% lower and fell almost 12% before finding its footing and climbing back.

Obviously, Moderna remains in the spotlight as the world continues to battle the Covid-19 pandemic.

By using a combination of Moderna and Pfizer  (PFE) - Get Pfizer Inc. Report-BioNTech  (BNTX) - Get BioNTech SE Report, the U.S. has done a good job garnering momentum in its vaccination efforts.

Johnson & Johnson  (JNJ) - Get Johnson & Johnson Report has also played a role, despite those initial scares over a blood clot issue.

For Moderna’s part, the company missed revenue expectations, although it raised its vaccine sales outlook

The idea that further booster shots will be needed to fight Covid-19 has also been acting as a catalyst for this group.

Let’s look at the chart.

Trading Moderna Stock

Daily chart of Moderna stock.

Daily chart of Moderna stock.

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Moderna opened right near a cluster of support on Thursday morning. That includes the 50-day and 21-week moving averages, as well as the 61.8% retracement.

The shares faded a bit below this area in early trading, but the stock found its footing before testing into uptrend support (blue line).

What can we make of this price action?

Unlike high-growth tech stocks that are being ravaged in a bear market, Moderna is finding buyers. Look at Fastly  (FSLY) - Get Fastly Inc. Class A Report for instance, which is getting buried on the day.

Buy-the-dip traders are stepping into Moderna stock, which is promising. But how high can it really rally here?

We need to see the stock clear its 21-day moving average. Over the 10-day would be a nice boost, too. Above that opens the door to the December high at $178.50

If Moderna stock can clear that level, it opens the door to the double-top high near $189.

The concern here would be a breakdown below the post-earnings low. That would drop Moderna below several key moving averages and levels, while putting uptrend support in play.

Below $140 opens the door to $120 and potentially lower.

Moderna is a tricky one. The stock has already posted a big rally, but as Covid-19 continues to linger, it remains an obvious catalyst for it and other pharma companies, like Pfizer. Keep the technicals in mind moving forward.