Halliburton Shares Drop 3.41% as Bearish Reversal Follows 7.84% Rally Forming Engulfing Pattern Below Key Averages

Halliburton (HAL) closed the most recent session with a 3.41% decline to $30.83, marking a significant bearish reversal after a sharp 7.84% rally the prior day. This two-day price action forms a potential bearish engulfing pattern, suggesting short-term bearish momentum. Key support levels emerge around $30.64 (January 6 low) and $28.19 (December 31 low), while resistance is clustered at $31.92 (January 5 close) and $33.03 (January 5 high). The recent breakdown below the 50-day and 100-day moving averages (calculated at ~$31.50 and ~$30.00, respectively) confirms a weakening trend, with the 200-day MA (~$28.50) acting as a critical long-term support threshold. The price remains below all major moving averages, indicating a bearish bias in both short- and medium-term horizons.

The MACD (12,26,9) shows a bearish crossover with the histogram contracting, while the KDJ (14,3,3) oscillator is in oversold territory at 25/30, hinting at potential near-term exhaustion. However, RSI (14) at 28 suggests overbought conditions, though the lack of a bounce from these levels implies the downtrend may persist. Divergences between RSI and price action are notable: while RSI has not yet confirmed an oversold bounce, the KDJ’s stochastic divergence (price lows vs. oscillator lows) may foreshadow a short-term rebound. Bollinger Bands (20,2) have widened following a contraction in mid-December, with the current price near the lower band (~$30.00). This volatility expansion aligns with the bearish bias, but a break below the $28.19 support could trigger a test of the 200-day MA.
Volume-Price Relationship reveals mixed signals. The January 5 rally (7.84%) saw a surge in volume (47.3M shares), validating the bullish move, while the subsequent 3.41% drop on January 6 occurred on similar volume (24.5M shares), suggesting sustained selling pressure. However, volume has trended lower since late December, which may indicate waning bearish conviction. This divergence between price and volume could hint at a potential near-term stabilization.
Fibonacci retracement levels drawn from the December 2025 low ($22.22) to the January 2026 high ($33.03) identify key thresholds at $29.75 (38.2%), $28.40 (50%), and $26.55 (61.8%). The current price is approaching the $28.40 level, which coincides with the December 30 close and the 50% retracement. A break below this level would likely target $26.55, aligning with the December 19 low and the 61.8% Fibonacci level.
Confluence of indicators emerges at the $28.19–$28.40 zone, where Fibonacci retracement, key historical support, and Bollinger Band dynamics converge. A successful hold above this level could trigger a KDJ-driven rebound, while a breakdown would validate the bearish MACD and RSI trends. Divergences between volume and price, however, suggest caution against overreliance on Fibonacci levels without accompanying volume confirmation.
The probabilistic outlook favors a continuation of the downtrend toward $26.55–$28.19, contingent on volume dynamics and MACD momentum. A short-term bounce is plausible near $28.40, but without a clear breakout above the 50-day MA (~$31.50), the broader bearish thesis remains intact. Traders should monitor the 200-day MA for a potential trend reversal signal, though the current alignment of multiple indicators suggests a high probability of further downside in the near term.