How Healthy Are CVS and Walgreen After CVS Quit Tobacco Sales?

NEW YORK (TheStreet) -- Technicians say stock-specific events are priced into the performance of a company's stock price. That is the case with Walgreen (WAG) and CVS Caremark (CVS) , which today changed its corporate name to CVS Health.

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Investors knew that Walgreen was considering relocating to Switzerland after completing its acquisition of Alliance Boots. Then on Aug. 5, the world's largest drug store chain announced that would remain headquartered in the U.S. The stock subsequently declined from its 50-day simple moving average at $72.62 on Aug. 5 to as low as $57.75 on Aug. 6, gapping below its 200-day SMA (green line) at $62.27 as shown on the daily chart below. Note that the daily chart shows oversold 12x3x3 daily slow stochastics.

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Courtesy of MetaStock Xenith

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