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Moderna Stock: Here's How to Trade It Amid the Omicron Variant

The omicron Covid variant has changed the landscape for vaccine makers. Here's how to trade Moderna stock now.

It’s been a whirlwind couple of days for the vaccine makers, including big moves in Moderna  (MRNA) - Get Moderna, Inc. Report.

That also goes for Pfizer  (PFE) - Get Pfizer Inc. Report, while Johnson & Johnson  (JNJ) - Get Johnson & Johnson Report and Novavax  (NVAX) - Get Novavax, Inc. Report have been active as well.

Warnings from the vaccine makers regarding the new omicron variant sent stocks into a tailspin on Tuesday. But for now at least, Moderna and Pfizer are holding up.

For Moderna specifically, the company has said it can have a vaccine ready in just a few months to fight off the new variant.

Earlier this month, Moderna stock was getting buried. The shares were down 57% from the highs after the company delivered a disappointing quarterly report.

By the time the Food and Drug Administration approved booster shots for adults a few weeks later, the stock was already on the move higher.

Can Moderna keep rallying?

Trading Moderna Stock

Daily chart of Moderna stock.

Daily chart of Moderna stock.

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Amid the rally from this month’s low, Moderna stock reclaimed a number of moving averages — virtually all of them, actually — and has done a good job getting back above several key areas.

The chart is littered with gaps, highlighting just how choppy and volatile it has been.

With Monday’s rally, Moderna filled one of two remaining upside gaps at $377. There is another up at $407.26, but to get there we will need to see a further rotation.

Specifically, not only is the $350 level a key zone on the chart, but the October high comes into play at $356.77.

From here, the bulls want to see Moderna stock hold the $350 area as support. If it can’t, the 10-day and 50-day moving averages could be in play on the downside.

On the upside, a further push higher could put downtrend resistance (blue line) in play, along with the 61.8% retracement near $388.

Above $388 could put the $407 gap-fill level we talked about in play, followed by the $413 level.

If Moderna stock clears $415, it’s possible we start talking about the $450 area again, followed by the $497.50 highs and $500.

Keep in mind that it's been a bumpy and volatile ride and with the headlines controlling the action right now, that's likely to remain the case with the vaccine stocks.