Circle Plunges 15.62% Amid High-Volume Selloff As Key Support Nears

Circle (CRCL) experienced a significant 15.62% decline in the most recent trading session, closing at 180.2505 after trading between 175.6 and 223.6469 on substantial volume of 46.96 million shares. This sharp drop concludes a volatile three-week period characterized by extreme price swings and elevated trading activity.
Candlestick Theory
Circle's candlestick patterns reveal high volatility and shifting momentum. The June 24 session formed a bearish engulfing pattern (open: 263.45, close: 222.65), signaling potential reversal after the preceding rally. This was confirmed by subsequent bearish candles, culminating in the June 27 session’s long upper shadow (high: 223.65, close: 180.25), indicating rejection of higher prices and robust selling pressure. Critical support now resides at the June 27 low of 175.60, which aligns with the June 18 swing low of 148.00. Resistance is firmly established near June 23’s peak at 298.99, with secondary resistance at the June 26 high of 226.95.
Moving Average Theory
Given the limited dataset (16 sessions), traditional 50/100/200-day moving averages are not feasible. Instead, shorter-period averages show a deteriorating short-term trend. The 5-day SMA (215.72) and 10-day SMA (195.22) both reside above the current close (180.25), confirming bearish near-term momentum. This price position below key short-term averages suggests entrenched selling pressure, though the absence of longer-term averages limits trend perspective.
MACD & KDJ Indicators
KDJ analysis (9-day window) reveals an RSV reading of 23.62 for June 27, translating to K=41.21, D=47.07, and J=29.49. While the RSV approaches oversold territory (sub-30), the K and D lines remain above 20, implying insufficient oversold confirmation. MACD calculations are unreliable with only 16 sessions of data. The KDJ’s neutral stance despite the sharp price drop indicates potential for further downside before technical exhaustion.
Bollinger Bands
Using a 10-day SMA (195.22) and 2-standard deviation bands, the upper band sits at 274.99 and the lower band at 115.44. Circle’s current close (180.25) positions it below the middle band, confirming bearish bias. The width between bands (≈160 points) reflects persistent high volatility, though the price is not yet testing the lower band. This suggests room for additional downside before technical support activates.
Volume-Price Relationship
Volume patterns validate recent bearish momentum. The June 23 peak (298.99) occurred with the highest volume (99.13 million shares), a classic climax top signal. Subsequent declines occurred on elevated volume: 68.22 million shares (-15.49% on June 24) and 46.96 million shares (-15.62% on June 27). Such high-volume distribution indicates strong conviction among sellers, reinforcing the sustainability of the current downtrend.
Relative Strength Index (RSI)
The 14-day RSI reading is 61.08 as of June 27, reflecting neutral momentum despite the substantial price drop. This divergence between price action (sharply lower) and RSI (holding above 30) signals unresolved downside pressure. Should Circle breach immediate support at 175.60, RSI could enter oversold territory (<30), but the current neutral reading suggests bearish momentum may persist.
Fibonacci Retracement
Applying Fibonacci levels to the swing low (149.15 on June 17) and high (298.99 on June 23) shows critical retracement zones: 23.6% (263.63), 38.2% (241.75), 50.0% (224.07), and 61.8% (206.39). Circle’s close below the 78.6% level (181.21) is notably bearish, violating a typical deep retracement threshold. This breach transforms 181.21–175.60 into a critical support confluence zone. Reclaiming the 50% level (224.07) would be necessary to signal technical recovery.
Confluence and Divergence Observations
Multiple indicators converge to support a bearish near-term outlook. The sustained close below short-term SMAs, volume-validated selling, Fibonacci violation, and candlestick rejection patterns collectively indicate downward momentum. Divergences emerge in momentum oscillators: KDJ’s RSV near oversold levels contrasts with RSI’s neutral positioning, revealing internal market tension. The breach of the 78.6% Fibonacci level (181.21) without immediate recovery suggests vulnerability to test 148.00 support if 175.60 fails. A stabilization above 181.21 could trigger a technical bounce, but high-volume selling pressure makes this scenario less probable without catalyst-driven buying.