Johnson & Johnson and Other Health Care Stocks With Recent Death Crosses

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Golden crosses and death crosses are common signals in technical analysis and refer to the relationship between short-term and long-term moving averages. The golden cross typically is seen as a bullish sign, perhaps a stock that has or is about to break out. The death cross, on the other hand, can be a bearish sign, perhaps warning investors to get out of the way or signaling that it may be time short the stock.

Here are five top health care stocks that recently saw their 50-day moving average cross below the 200-day average, a death cross, and could be considered contrarian plays or short opportunities.

Johnson & Johnson (NYSE: JNJ) saw its death cross last week. The longer-term average has been coming down since the sell-off in December, though the share price has recovered almost 11% year to date. Johnson & Johnson is considered one of the best dividend stocks for retirees to own. Shares are still about 5% lower than three months ago, while the Dow Jones industrial average is up more than 6% in that time.

UnitedHealth Group Inc.’s (NYSE: UNH) death cross came this week, and on last look both the 50-day and 200-day moving averages were on the decline. This stock also makes the list of best dividend stocks for retirees to own. Since the beginning of the year, its shares are up 9% or so, and Wall Street analysts on average recommend buying the shares.

Amgen Inc.’s (NASDAQ: AMGN) death cross also occurred this week, after the gap between the two averages had been closing since last October. As with some of its peers, short interest in this biotech stock has waned recently. Amgen shares are down more than 4% year to date. Yet, here too analysts recommend buying shares.

U.K. drugmaker AstraZeneca PLC (NYSE: AZN) saw its death cross earlier this month, though if the recent share price spike holds, this crossover may be undone soon. Better-than-expected earnings results boosted the stock, and some Phase 3 trial results are also due before long. The shares so far are up more than 6% year to date. Note that in this case, the consensus recommendation is Strong Buy.

Biogen Inc. (NASDAQ: BIIB) also saw a death cross earlier this month, and the gap between the moving averages is now more than 9% of the share price. The stock was just downgraded by one analyst and another recently anticipated no growth in the share price. The stock is up more than 6% since the beginning of the year. The consensus recommendation remains to buy Biogen shares.


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