Circle Stock Plunges 7.26% as Bearish Technicals Signal Extended Downtrend

Circle (CRCL) declined 7.26% to close at $125.24 on August 25, 2025, continuing its sustained downtrend amid broad technical weakness. The following analysis examines key technical dynamics shaping its price trajectory.
Candlestick Theory
Recent sessions reveal persistent bearish dominance, with the August 25 candle closing near its low ($124.70) after rejecting the $135.32 intraday high, forming a decisive bearish marubozu. This follows an August 22 shooting star pattern (high: $144.70, close: $135.04), confirming resistance near $140–$145. The $124.70–$125 zone now establishes critical short-term support, while $135–$140 constitutes immediate resistance. A sustained break below $124.70 may trigger accelerated selling.
Moving Average Theory
The 50-day moving average ($165 current reading) maintains a steep downward slope above the price, confirming bearish structural positioning. Price remains systematically below this average, with no significant convergence observed. The absence of longer-term averages (100-day/200-day) due to limited data constrains full trend analysis, but the consistent trading below the declining 50-day MA signals entrenched selling pressure.
MACD & KDJ Indicators
The MACD (-10.2 histogram) sustains a bearish crossover below its signal line, with both lines in negative territory, signaling unbroken downward momentum. KDJ readings (K: 18, D: 21, J: 12) reside in oversold territory, though without bullish divergence. While KDJ’s sub-20 position suggests potential exhaustion, MACD’s bearish alignment and negative histogram gradient caution against premature reversal expectations.
Bollinger Bands
Bollinger Bands (20-day) expanded sharply during August’s decline, reflecting heightened volatility. Price currently hugs the lower band ($123), characteristic of a strong downtrend. The lack of band contraction or price detachment from the lower band suggests continued downward momentum. A close above the lower band would be the initial prerequisite for stabilization.
Volume-Price Relationship
Distribution signatures prevail, with elevated volume accompanying key down days (e.g., August 14: 17.9M shares, -9.10%; August 25: 10.1M shares, -7.26%). Recent rallies show comparatively muted volume (August 20: +1.91% on 9.9M shares), undermining recovery credibility. Volume divergence remains absent, confirming bearish momentum alignment.
Relative Strength Index (RSI)
The 14-day RSI (27.8) entered oversold territory (<30) for the first time since June. Historically, Circle’s RSI has remained oversold for extended periods during strong trends (e.g., 10 sessions below 30 in June). While current levels imply potential technical exhaustion, the absence of bullish RSI/price divergence and persisting bearish volume patterns suggest oversold conditions may extend further before reversal.
Fibonacci Retracement
Applying Fibonacci levels to the entire rally from the $83.23 June low to the $263.45 June peak reveals significant thresholds. The recent close below the 61.8% retracement ($152.07) validated further downside, with price now testing the 78.6% support ($121.80). The August 25 low of $124.70 narrowly held this level, establishing $121.80–$124.70 as a critical support confluence. A breakdown here would expose the $83.23 origin point.
Confluence and Divergence Observations
Strong confluence exists near $121–$125, combining Fibonacci support, Bollinger Band proximity, and oversold RSI/KDJ readings. This may provoke technical bounces, though sustained recovery would require volume-backed clearance of $135 (candlestick resistance) and $152 (Fibonacci barrier). Notable bearish consensus prevails, with no material divergences among indicators. The primary discrepancy involves oversold oscillators (RSI/KDJ) conflicting with unresolved MACD and moving average bearishness, suggesting any rebound may be short-lived without fundamental catalysts.