Novo Nordisk recently experienced another challenging trading session, dropping over 2% from the previous session. The stock has faced difficulties throughout the year and is now over 50% lower than its peaks earlier in 2024.
Novo Nordisk is a well-known name in pharmaceuticals, focusing on treatments for metabolic and chronic diseases. This year’s steep decline comes despite previously increasing demand for its products, which had boosted market interest.
The current stock price drop presents potential buying opportunities based on technical analysis. The first key level to watch is near $43, the lowest price reached this year, which may provide support and prompt a rebound.
Another potential buying zone lies around $40.78, aligning with a gap that may act as a technical target. These levels suggest the highest probability of a rebound occurring.
While these technicals offer potential entry points, sound risk management is essential, as market outcomes cannot be predicted with certainty.
Given the dramatic 50% fall in Novo Nordisk from its highs earlier in 2024, we see that implied volatility has spiked to over 55%, a level not seen in several years. This makes buying options expensive, so our focus is shifting to strategies that involve selling this rich premium. The stock’s sharp, consistent decline creates clear opportunities for option sellers who believe the worst may be priced in.
We are looking at the $43 support zone as a key area to sell cash-secured puts for January or February 2026 expirations. This approach allows us to collect income now and sets our purchase price below the current market, which is attractive given the recent competitive pressures. Q3 2025 industry reports did show that new competition from Eli Lilly’s oral GLP-1 drug captured 15% of the new-start market, but our models suggest this headwind is stabilizing.
For a more defined-risk trade, the gap fill near $40.78 is an ideal location to construct bull put spreads. By selling a put option with a $41 strike and buying a lower one around $38 for protection, we can limit potential losses if the stock continues to fall. This conservative structure is sensible when we recall the stock’s rapid ascent in 2023 and early 2024, which created very few solid support levels on the way up.
Alternatively, if the stock breaks below the $43 pivot low with significant volume, we must respect the ongoing bearish momentum. In this case, we would look to buy put options or initiate bear call spreads, betting on a further decline toward the $40 psychological level. This view is reinforced by persistent news throughout 2025 of potential government price negotiations in the U.S., which remains a significant overhang for the entire sector.
