Exxon Mobil Shares Drop 3.44% Marking Bearish Reversal from $125.93 Highs As Key Support Levels and 200-Day MA at Risk

Exxon Mobil (XOM) closed at $121.05 on January 6, 2026, with a 3.44% decline, marking a bearish reversal from recent highs near $125.93. The price action suggests a potential breakdown below key support levels, particularly the 200-day moving average, which historically acted as a critical trendline. The recent session’s candlestick pattern—a long bearish real body with a lower shadow—aligns with a potential “bearish engulfing” or “dark cloud cover” formation, indicating short-term selling pressure.

Candlestick Theory

The price has oscillated between $119.11 and $125.93 over the past month, forming a descending channel. Key support levels are identified at $121.05 (recent close) and $117.76 (December 15 low), while resistance sits at $125.36 (January 5 high). A breakdown below $121.05 could target the next support at $119.11, with a potential bearish continuation pattern emerging if the price fails to rebound.

Moving Average Theory

The 50-day moving average currently sits at approximately $120.50, while the 200-day average is near $118.50. The price has crossed below the 50-day MA, confirming a short-term bearish bias. However, the 200-day MA remains a critical threshold; a sustained close below this level could signal a deeper correction. The 100-day MA at $119.00 adds intermediate support, creating a confluence zone between $118.50 and $119.11.

MACD & KDJ Indicators

The MACD histogram has turned negative, reflecting weakening bullish momentum, while the signal line crosses below the zero level, reinforcing the bearish outlook. The KDJ indicator (Stochastic) shows oversold conditions, with the %K line at 25 and %D at 30, suggesting potential for a rebound. However, a bearish divergence exists between the price and the %K line, as the latter failed to rise despite a rebound in early January. This divergence may delay a meaningful recovery.

Bollinger Bands
Volatility has expanded recently, with the bands widening to capture the $125.93 high and the $119.11 low. The price currently rests near the lower band, historically a trigger for short-term bounces. However, without a sustained close above the 20-day MA (approximately $122.00), the bands may contract again, signaling range-bound trading.

Volume-Price Relationship

The recent 3.44% drop was accompanied by elevated volume (23.29 million shares), validating the bearish move. However, volume has declined in subsequent sessions, suggesting weakening conviction in the downtrend. A follow-through rally with increasing volume could indicate a short-covering bounce, but sustained bearish momentum requires higher volume on subsequent down days.

Relative Strength Index (RSI)

The 14-day RSI stands at 28, entering oversold territory. While this may suggest a potential rebound, the RSI has shown bearish divergence, failing to rise above 40 despite price rebounds in early January. This cautionary signal implies the oversold level may not trigger a reversal but instead a continuation of the downtrend.

Fibonacci Retracement

Applying Fibonacci levels between the December 19 low ($115.93) and January 5 high ($125.93), key retracement levels at 38.2% ($121.35) and 50% ($120.63) align with recent support. The current close at $121.05 suggests a test of the 38.2% level, with a breakdown expected to target the 61.8% retracement at $119.81.
The confluence of bearish candlestick patterns, moving average crossovers, and MACD bearish signals strengthens the case for further downside, while divergences in RSI and KDJ suggest caution about premature rebounds. Traders should monitor the $119.11 support level and the 200-day MA for confirmation of a deeper correction.