Pfizer and Moderna retreat after hitting all-time highs
New studies have recently been published from the U.S. CDC indicating that the effectiveness of Pfizer and Moderna vaccines drops to 66% due to the strong emergence of the delta variant and that the immunity provided by these vaccines decreases at a faster rate than expected over the months, thus increasing doubts about the vaccination process.
Given this situation, the U.S. FDA has granted the authorization and full approval of the vaccine against Covid-19 to the vaccine provided by Pfizer, which could result in an uptick in confidence in these vaccines and a new boost to the vaccination process after the effectiveness of these vaccines is increasingly questioned in recent weeks, with which it is also already speculated that not only a third booster dose is necessary but also some specialists indicate that these could become annual and seasonal vaccines similar to flu vaccination campaigns.
Obviously, this last point would be well regarded by the pharmaceutical companies since this would ensure a good part of the future income through the sale of their vaccines to fight the virus in the coming years.
Although we commented in previous analyses after the strong growth of the Delta variant, doubts are emerging about the economic recovery due to the serious problems that this variant is generating in Asia and the crisis of confidence that it generates around vaccines, Pfizer and Moderna are obtaining very good results both economic and stock market.
Pfizer Analysis
So far this year, Pfizer is up 31.43% in the stock market mainly thanks to the strong bullish momentum it has experienced after the break of the side triangle on July 20 that led to a bullish rally of 22.21% from $40 per share to reach its all-time highs on August 18 at $51.86.
This strong upward momentum was supported by the positive results for the second quarter of the year presented on July 28, where Pfizer obtained a profit per share of $1.07 and revenue of $18.98 billion, exceeding market expectations as well as continuing with the trail started in the quarterly results for the first quarter of the year.
Technically speaking, if we look at the daily chart, we can see that the price is currently in a retracement that started after marking all-time highs after the strong bullish rally, which has led the price to break down the 23.6% Fibonacci support retracement level, which could open the door to further correction to its next support level in the coincident zone of its moving average. of 18 blank sessions and the fibum level of 38.2%.
This correction may be positive for the price due to large accumulated overbought that we have been observing during the last month, so, if the price is able to maintain the important support level discussed above, it could be a good point to consolidate and start a new upward momentum. The loss of this important support level could be a sharp setback that would open the door to further correction that could lead the price to seek its previous resistance level at the December 2020 highs.
Evolution of the last 5 years:
- 2020: -0.89%
- 2019: -10.24%
- 2018: 20.51%
- 2017: 11.51%
- 2016: 0.62%
Moderna Analysis
For its part, the big beneficiary in the stock market since the beginning of the pandemic has undoubtedly been Moderna, which has gone from trading from levels close to $30 per share in March 2020 to mark historical highs at $496.71 per share, which means a revaluation of the company of more than 1200% in just 18 months, accumulating an annual rise of 278.04%.
As with Pfizer and although its effectiveness against the new variants is in question, this company is obtaining excellent quarterly results. On August 5, Moderna presented its results for the second quarter of the year in which it obtained a profit per share of $6.46 and revenues of $4.35 billion, far exceeding market expectations.
Technically speaking it is in a situation very similar to that of its main competitor, after marking all-time highs it has begun a correction that has led it to face its average 18 sessions at the 38.2% Fibonacci retracement level where it seems to have found support, as the price is recovering in search of $400 per share again.
It is important that we see the evolution of this stock in the coming sessions, because if it fails in the attempt to recover the $400 per share in a sustained way, the price could make a greater correction in search of the following support levels around the 50% Fibonacci.
Evolution in the last 2 years:
- 2020: 434.10%
- 2019: 28.09%
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