Quest Diagnostics Incorporated (DGX) shares moved briefly higher during Tuesday's session after Morgan Stanley upgraded the stock to Overweight with a price target of $139 per share. The new price target reflects a nearly 20% premium to Monday's closing price.

Analyst Ricky Goldwasser believes that the COVID-19 diagnostic testing opportunity may be larger than expected if it is added as part of a pre-elective procedure routine. With broadening testing guidelines and new market opportunities, Goldwasser raised her 2021 estimates above her pre-COVID-19 forecasts and sees opportunities for Quest Diagnostics to gain market share.

In addition, Quest Diagnostics announced that individuals could purchase COVID-19 antibody testing kits for themselves through QuestDirect without visiting a doctor's office. The new service significantly broadens access to COVID-19 antibody tests. After visiting a Quest center to get blood drawn, the results are available within one or two days following the bloodwork.

Chart showing the share price performance of Quest Diagnostics Incorporated (DGX)

From a technical standpoint, the stock briefly broke out from its pre-crisis highs made in early March before giving up ground later in the session. The relative strength index (RSI) remains in overbought territory with a reading of 73.70, but the moving average convergence divergence (MACD) remains in a strong bullish uptrend. These indicators suggest that the stock could see some consolidation before a move higher.

Traders should watch for a close above reaction highs of around $118.70 over the coming sessions to confirm a breakout and a subsequent move to fresh highs. If the stock moves lower, traders could see the stock price reach trendline support near $110.00 over the next few days. Technical indicators suggest that the stock could see some consolidation before another move higher, but the intermediate-term trend remains decidedly bullish.

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