Insights 
VT 
Humana Inc. has been in a corrective phase after a lengthy rally since the early 2000s. The company completed a major five-wave advance, ending the bullish wave III cycle around 2022.
Currently, Humana is in wave IV, which appears as an (A)-(B)-(C) correction pattern on the chart. Wave (A) showed a sharp decline, wave (B) a partial recovery, and wave (C) is expected to conclude the correction between the 0.382 (155.66) and 0.618 (68.81) Fibonacci retracement levels.
This correction zone is where buyers typically return, potentially sparking a new upward movement. The share price trades near $290, remaining above the invalidation level at $4.76, suggesting continuation of the bullish structure.
Humana’s market posture indicates a readiness to resume an uptrend. The annotation “Turning Up” on the chart supports this anticipatory stance for the next bullish cycle to commence.
Given that today is October 7, 2025, the long corrective phase in Humana (HUM) appears to be reaching its final stages. We have been tracking the stock’s decline since its peak back in 2022, and this pattern suggests a major bullish turn is on the horizon. For derivative traders, this signals it is time to prepare for a significant upward move in the coming weeks and months.
Considering the stock is currently trading near $290, we see an opportunity to position for the anticipated rally. One approach is to purchase call options with expirations in early 2026, which allows enough time for the new uptrend to gain momentum. This strategy provides exposure to the upside while defining risk to the premium paid for the options.
The fundamental outlook supports this technical view, as recent data from September 2025 showed that Medicare Advantage enrollment growth has exceeded expectations for the year. This underlying business strength provides a solid foundation for a new wave of investor confidence. Historically, strong enrollment figures have often preceded periods of significant stock appreciation for health insurers like Humana.
For those with a more conservative risk appetite, selling cash-secured puts with strike prices below current levels, perhaps around the $200 mark, could be an effective strategy. With the VIX, a measure of market volatility, currently elevated at 23 due to government shutdown concerns, option premiums are higher than usual. This tactic allows us to collect that premium while setting a lower entry point if the stock sees one final dip before reversing higher.
The broader market environment also seems favorable for a rotation into defensive sectors like healthcare. With ongoing uncertainty surrounding fiscal policy and the Dow Jones showing weakness, investors are likely to seek safety. This defensive positioning should provide a tailwind for Humana as it completes its corrective pattern and begins its next major advance.
