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Yesterday, health insurance stocks took a hit due to lower-than-expected Medicare Advantage (MA) payment rates. This news had a ripple effect on CVS Health Corp (NYSE:CVS), which experienced a 7.2% drop, the largest daily percentage loss since August. Although shares recovered slightly today with a 0.7% increase to $74.37, the recent downturn has brought CVS close to its 200-day moving average trendline, which has historically been bullish.

For those thinking of buying the dip, Schaeffer’s Senior Quantitative Analyst Rocky White advises that CVS has been within one standard deviation of its 200-day moving average before, resulting in an average 3% gain one month later. Additionally, the stock’s current 14-day relative strength index (RSI) of 29.4 suggests that it is oversold and could see a short-term bounce. Before yesterday’s decline, CVS had been on an upward trend, with only three daily losses since March 14, though overall the stock is down 5.7% since the beginning of the year.

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