Technical Analysis:
Based on the latest price data, MRK is showing signs of weakness with RSI-14 at 45.28, indicating a neutral to slightly bearish momentum. The stock is trading below all major moving averages (SMA 20, 60, 200), suggesting a bearish trend.
News Impact Analysis:
- Deutsche Bank recently downgraded MRK to Hold from Buy and lowered PT to $105 from $128, citing concerns about Keytruda's loss of exclusivity in 2028. This has created selling pressure on the stock.
- Trump's administration has indicated plans to continue Medicare price negotiations, which could impact pharmaceutical companies' pricing power, including MRK.
- A private meeting between pharmaceutical executives and Trump discussed potential tariffs on pharmaceutical goods and manufacturing relocation to the U.S., adding uncertainty to the sector.
Price Prediction for Next Week:
Based on technical indicators and recent news:
- Support level: $82.26 (Fibonacci S1)
- Resistance level: $88.75 (Fibonacci R1)
Expected price movement scenarios:
- Bearish case (60% probability): Price could test $82-83 level if market sentiment remains negative
- Neutral case (30% probability): Trading range between $85-88
- Bullish case (10% probability): Limited upside potential to $89-90 due to multiple headwinds
Trading Recommendation: SELL
Rationale:
- Multiple bearish catalysts from policy and regulatory fronts
- Technical indicators showing weakness
- Below major moving averages
- Recent analyst downgrade with concerns about future revenue streams
Target exit price: $82.50
Stop loss: $91.00 (above recent resistance)
Technical Analysis:
Based on the latest price data, MRK is showing signs of weakness with RSI-14 at 45.28, indicating a neutral to slightly bearish momentum. The stock is trading below all major moving averages (SMA 20, 60, 200), suggesting a bearish trend.
News Impact Analysis:
- Deutsche Bank recently downgraded MRK to Hold from Buy and lowered PT to $105 from $128, citing concerns about Keytruda's loss of exclusivity in 2028. This has created selling pressure on the stock.
- Trump's administration has indicated plans to continue Medicare price negotiations, which could impact pharmaceutical companies' pricing power, including MRK.
- A private meeting between pharmaceutical executives and Trump discussed potential tariffs on pharmaceutical goods and manufacturing relocation to the U.S., adding uncertainty to the sector.
Price Prediction for Next Week:
Based on technical indicators and recent news:
- Support level: $82.26 (Fibonacci S1)
- Resistance level: $88.75 (Fibonacci R1)
Expected price movement scenarios:
- Bearish case (60% probability): Price could test $82-83 level if market sentiment remains negative
- Neutral case (30% probability): Trading range between $85-88
- Bullish case (10% probability): Limited upside potential to $89-90 due to multiple headwinds
Trading Recommendation: SELL
Rationale:
- Multiple bearish catalysts from policy and regulatory fronts
- Technical indicators showing weakness
- Below major moving averages
- Recent analyst downgrade with concerns about future revenue streams
Target exit price: $82.50
Stop loss: $91.00 (above recent resistance)