To Catch A Falling Knife - A United Health Story
Introduction
$UnitedHealth (UNH.US)$ group's dramatic share price decline in 2025 happened due to a series of unfortunate events that led to a strong erosion of investor confidence. The catalyst was a massive cyberattack on its subsidiary, Change Healthcare, back in February 2024, which disrupted medical billing nationwide, and exposing the data of 190 million people. This led to projected losses of up to USD$1.6 billion. This was followed by the shocking December 2024 assassination of Brian Thompson, CEO of UnitedHealthcare, which intensified public scrutiny and internal instability.
Compounding these issues, and sticking to the adage of Murphy's law... "Everything that can go wrong, will go wrong". The U.S. Department of Justice launched a criminal investigation into alleged Medicare Advantage fraud, accusing UnitedHealth of inflating patient risk scores to secure higher federal payments. Amid soaring medical costs and executive upheaval, and finally following CEO Andrew Witty's abrupt resignation in May 2025, the company suspended its 2025 earnings forecast. These cascading events culminated in a staggering $190 billion loss in market value, with shares plummeting over 50% from their peakPrice has fallen so much.
Time to buy?
According to recent insider filing from Bloomberg, directors from within $UnitedHealth (UNH.US)$ Group has been buying up large amounts of stocks. Both current CEO Hemsley and CFO Rex have both bought shares amounting up to USD$25m and USD$5m respectively
Could the above action be the famous 'inside' trade that investors are now looking to follow just to turn a quick profit? There are some key reasons why insiders would buy their shares and, while many are led to believe that the main reason for doing so is to signal that the stock is undervalued, the other reason that insiders would buy their own shares would be to reassure the market and also to provide some form of stabilisation for the company stock during periods of volatility and bad press.
Our Take - Macro and Micro perspective
"Never trade against the trend as the trend is your friend, until it ends." For now, from a technical perspective, UnitedHealth Group's share price is in a downward trend across all the major timeframes, monthly, weekly and daily. Any bounce now will most likely be attributed to a couple of factors, such as "short covering", "margin calls" and taking advantage of any short term intraday bounce.
From a technical perspective, price could do an intraday bounce above 272.00 near-term support to 350.00 near-term resistance before shaping one more push lower towards 2nd support at 187.75. Technical indicators are flashing and showing extreme bearish conditions. Alternatively, only 2 consecutive daily candlestick close above 350 will see short term recovery towards 431.70 resistance.
It is also important to note that on a macro level, Moody's Ratings downgraded US from Aaa down to Aa1, citing nation's ballooning debt and fiscal outlook. This is already adding further downward pressure on S&P futures index prices and could also have a spill over effect to the rest of the markets.For me, I would say, never ever try to catch a falling knife. Of course, if one believes that they have diamond hands... Trade safe and stay safe.
Prepared by:
Moomoo Singapore
Isaac Lim CMT, CFTe
Chief Market Strategist
Disclaimer: This report is provided for informational and general circulation purposes only and should not be construed as an offer, solicitation, or recommendation for the purchase or sale of securities, futures, or other investment products. It does not take into consideration any particular needs of any person. This advertisement has not been reviewed by the Monetary Authority of Singapore.
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Cui Nyonya Kueh : Mr Isaac Lim wrote. Not intern ok.
YGZhang : Grasp the knife handle.![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
72547067 : why not I wouldn't stand in front of everybody throw them at me
73241639 : Markets have a tendency to overreact to news, and I think all the bad news is in, and so is the overreacting. Insiders are buying heavily and they know more than I do. If they are buying now, so am I.
73241639 : Shine bright like a DIAMOND!
Chalet : thanks. caught it at 250$