Monday, July 9, 2012

United Health Group (NYSE: UHN)

UnitedHealth Group Incorporated operates as a diversified health and well-being company in the United States. The company's UnitedHealthcare segment offers consumer-oriented health benefit plans and services to national employers, public sector employers, mid-sized employers, small businesses, and individuals. This segment serves through a network of 754,000 physicians and other health care professionals, and 5,400 hospitals. Its OptumHealth segment provides personalized health management services, decision support services, access to networks of care provider specialists, well-being solutions, behavioral health management solutions, financial services, and clinical services. This segment serves individuals through programs offered by employers, payers, government entities, and directly with the care delivery system. The OptumInsight segment offers software and information products, advisory consulting services, and business process outsourcing services to hospitals, physicians, commercial health plans and government agencies. Its OptumRx segment provides a multitude of pharmacy benefit management services, including prescribed medications and patient support. This segment also offers claims processing, retail network contracting, and rebate contracting, as well as management and clinical programs, such as step therapy, formulary management, and disease/drug therapy management programs.

To review potential trading opportunities with UnitedHeath's stock, please take a look at the 1-year chart of UNH (UnitedHealth Group, Inc.) below with my added notations:

UNH rallied nicely from a low of $42 last October to a high at $60 in April of this year. The stock has now formed what appears to be a Double Top price pattern (red). Double Tops are reversal patterns and are as simple as they sound: Rallying up to a peak (T), selling off to a support, and then rallying back up again to approximately the same top (T). As with any price pattern, a confirmation of the pattern is needed. UNH would confirm this pattern by breaking the $54 support (navy), which was also a previous resistance.

Keep in mind that simple is usually better. Had I never pointed out the Double Top pattern, one would still think this stock is moving lower if it simply broke through the $54 support level. So, whether you noticed the pattern or not, the trade would still be the same.

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