CVS Health Corporation (CVS) shares fell more than 4% during Tuesday's session amid ongoing uncertainty in the health care space. After the Department of Justice moved to strike down Obamacare, lawmakers scrambled to come up with an alternative over the past week. President Trump signaled on Tuesday that a replacement wouldn't be introduced until after the 2020 election, which could become a referendum on health care.

President Trump has also been working with Democratic lawmakers to reduce drug prices. As part of those efforts, pharmacy benefit manager executives will appear before the Senate Finance Committee on April 3 to answer questions about their role in drug pricing. Government proposals to change the drug rebate process could pressure insurers and the drug supply chain that relies on these rebates to drive revenue.

Over the longer term, Democratic presidential candidates have expressed support for Medicare-for-All, which could dramatically change prospects for insurers and the pharmaceutical supply chain. The return of the Obamacare tax could also have a negative influence on the industry if Democratic lawmakers overturn restrictions put in place by the current administration.

Technical chart showing the share price performance of CVS Health Corporation (CVS)

From a technical standpoint, the stock's mid-March rally lost steam, and CVS is not retesting lows made earlier last month. The relative strength index (RSI) is moving toward oversold levels with a reading of 33.48, but the moving average convergence divergence (MACD) could see a bearish crossover in the near term. These indicators suggest that the stock could see some consolidation at support before continuing its move lower.

Traders should watch for some consolidation at trendline and S1 support levels near $51.00 over the coming sessions. If the stock breaks down from these levels, traders could see a move toward trendline and S2 support at $48.00. If the stock rebounds from these levels, there is near-term resistance at the pivot point of $54.87 as well as reaction highs and R1 resistance at $57.80 that could contain any upside.

The author holds no position in the stock(s) mentioned except through passively managed index funds.