Oracle Stock Plunges 11% In Two Days After 36% Surge Sparks Volatility

Oracle (ORCL) has experienced significant volatility recently, declining 5.09% to $292.18 on September 12, 2025, marking a two-day cumulative drop of 11.01%. This sharp retreat followed a 35.95% surge on September 10, creating a pronounced bearish reversal pattern. Below is a comprehensive technical analysis integrating multiple methodologies.
Candlestick Theory
The September 10 session formed a large bullish candle closing at $328.33 on explosive volume ($43.65B), suggesting euphoric buying. This was immediately negated by consecutive bearish engulfing patterns on September 11-12. The latter session’s long upper wick ($307.97 high vs. $292.18 close) signals rejection at the $308 resistance level. Critical support now resides near $244-$252, aligning with the pre-surge consolidation zone from early September.
Moving Average Theory
The 50-day MA (currently near $240) and 200-day MA (~$210) maintain upward slopes, preserving the structural bull trend. However, the sharp pullback has pushed prices decisively below the 100-day MA ($260). This breach, combined with the widening gap between current price and the 50/100-day MAs, implies accelerating near-term bearish momentum. A death cross (50-day crossing below 100-day) may materialize if selling persists.
MACD & KDJ Indicators
MACD histogram readings turned negative after the September 12 close, confirming bearish momentum as the signal line crosses below the MACD line. KDJ exhibits similar deterioration: The %K line (currently ~25) plunged from overbought (>80) territory on September 10 to near-oversold levels within two sessions. While this rapid descent suggests exhaustion potential, both oscillators lack stabilization signals, implying unresolved downward pressure.
Bollinger Bands
Price exited the upper band ($315) during the September 10 spike, triggering a reversion impulse. The subsequent collapse breached the lower band ($285) on September 12, accompanied by expanding band width – a volatility breakout signal. Historically, ORCL tends to revert toward the 20-day moving average (now $275) after such extremes. Continued trading below the lower band would indicate panic-driven distribution.
Volume-Price Relationship
The September 10 rally occurred on record volume ($43.65B – the highest in the dataset), yet failed to sustain gains. This climactic volume during a parabolic advance typically signals exhaustion. The subsequent 11% drop unfolded on above-average volume ($21.9B and $15.1B), confirming distribution. Volume divergence is absent, suggesting bearish conviction remains intact near-term.
Relative Strength Index (RSI)
RSI rocketed to 85 on September 10 – deeply overbought – then collapsed to 38 within two sessions. While sub-30 would signal oversold conditions, the velocity of the decline may precede a technical bounce before RSI reaches traditional reversal thresholds. Notably, similar RSI plunges in January 2025 and June 2025 aligned with 15-20% corrections, highlighting the indicator’s value in identifying overextended moves despite its lagging nature.
Fibonacci Retracement
Applying Fibonacci to the rally from August’s low ($176) to September’s high ($346) shows key retracement levels at $261 (38.2%), $244 (50%), and $228 (61.8%). The stock breached the 38.2% level ($261) decisively, with the 50% zone ($244) offering the next logical support. This aligns with the high-volume consolidation base from August 29 – September 9, where $245-$252 saw concentrated accumulation.
Confluence & Divergence Observations
A significant confluence exists between Fibonacci support ($244-$252), the 50-day MA ($240), and the pre-breakout consolidation zone ($245-$252), making this area a critical battleground. Key divergences include the lack of corresponding volume on the September 12 low versus the September 10 high, potentially foreshadowing a relief rally. However, MACD, Bollinger Bands, and moving average alignments reinforce the bearish near-term bias.
In summary, Oracle exhibits overheated conditions following its parabolic surge, with multiple indicators confirming near-term bearish momentum. While a technical bounce may emerge near $252-$261 support, sustained trading below $244 would signal deeper correction potential toward the $228 Fib level. The structural uptrend remains intact above the 200-day MA, but requires price stabilization above $275 to rejuvenate bullish confidence.