Clover Health share price looks set to open lower when the US markets open for trading this Friday. The stock is trading at 7.37 in premarket trading, slightly lower than Thursday’s close of 7.39.
Clover Health has been on a downward slide for the greater part of September, despite the Centers for Medicare and Medicaid Services approval of the company’s plan to expand into 110 counties across the US.
However, October may provide a new opportunity for traders bullish on the stock, as the annual election period for those eligible for Medicare will commence on 15 October. This registration will run to 7 December.
Company executives are hopeful of repeating or exceeding the 2nd quarter performance, where it doubled its memberships and revenue by 140% to $412.5million. It will be looking to avoid the unduly high running costs which have kept away profits and depressed investor outlook on the stock.
The Clover Health share price activity is testing support at the 7.39 price mark. A breakdown of this area allows the bears to attain the 6.58 support (19 May low). Further south, additional support is seen at the 5 March low of 6.30.
On the flip side, a bounce on the 7.39 support and upward extension allows for a bullish retracement towards the 8.85 resistance. 8.00 could be a potential pitstop along this route. Only if the price breaks above 8.85 can the bulls target the 9.94 resistance level (previous cluster of lows in October/November 2020). Additional barriers to the north reside at the 11.86 and 13.29 price marks.
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