Is Novavax Breaking Out After The Rally?

Novavax, Inc. NVAX shares rallied higher Monday after renewed COVID-19 concerns.

The new Delta variant has been spreading and is a major concern with it recently becoming the dominant strain of COVID-19. Retail traders have been pushing the stock up as concerns have been rising.

Novavax was up 12.78% at $210.51 at last check Monday.

See Also: Why Novavax Stock Is Trading Higher Today

Novavax Daily Chart Analysis

• Shares were falling the past few months, but now look to be breaking out of what technical traders call a falling wedge pattern.
• The stock is trading above both the 50-day moving average (green) and the 200-day moving average, indicating sentiment in the stock has been bullish.
• These moving averages may both hold as an area of support in the future.

Key Novavax Levels To Watch

• The stock looks like it is breaking out of the falling wedge pattern Monday, as the stock was able to cross above pattern resistance.
• The stock needs to continue to rise and find support near the pattern resistance to confirm the breakout. The stock could still be rejected at pattern resistance and start moving lower.
• The Relative Strength Index (RSI) has been heating up the past few weeks and now sits at 60. The RSI is nearing the overbought area and if it is able to reach this area while the price moves higher it could see a large breakout.

What’s Next For Novavax?

Bullish traders would like to see the stock continue to move higher and break out of the wedge pattern. Bulls would then like to see the pattern resistance hold as an area of support. Bulls want to see the stock stay above both moving averages to keep sentiment in the stock bullish.

Bearish traders would like to see the stock fall back into the wedge pattern. If the stock can fall back into the wedge pattern bears would then like to see it fall to the bottom of the wedge before breaking pattern support. Bears would like to see the stock cross below the moving averages for a potential change in sentiment.