Paramount Skydance Slumps 5.65% Amid Technical Bearish Signals

Paramount Skydance (PSKY) declined 5.65% in the most recent session to $17.53, extending its two-day loss to 6.71%. This technical analysis evaluates the stock’s behavior through multiple lenses using the provided historical price data.
Candlestick Theory
Recent sessions reveal significant volatility. The September 12 bullish candle (+7.62%) with high volume signaled strong buying momentum, but this was immediately followed by two consecutive bearish candles. The September 16 session printed a long red candle closing near its low ($17.53 vs. low of $17.45), indicating persistent selling pressure. Key support emerges at $17.45 (intraday low), with resistance at $18.62 (September 16 high) and $19.05 (September 15 high). A break below $17.45 could target the psychological $16.90 support.
Moving Average Theory
Using 5-day, 10-day, and 20-day moving averages (due to limited data), the short-term trends show deterioration. The price has crossed below the 5-day SMA ($18.25), and the 10-day SMA ($17.48) is now being tested. Meanwhile, the 20-day SMA ($15.42) remains below the current price, suggesting the intermediate uptrend from mid-August lows ($10.12) may still be intact. However, the rapid compression between short-term averages suggests weakening momentum.
MACD & KDJ Indicators
The MACD (12,26,9) has crossed below its signal line on the daily chart, generating a bearish crossover. Histogram bars are expanding negatively, confirming increasing downward momentum. Concurrently, the KDJ indicator shows %K (12.3) and %D (21.7) both in oversold territory, though %K has not yet crossed above %D to signal potential reversal. This alignment between MACD’s bearish signal and KDJ’s oversold readings suggests further downside risk before stabilization.
Bollinger Bands
Bollinger Bands (20-day, 2σ) contracted significantly before the September 11–12 surge (15.55% and 7.62% gains), indicating the breakout was preceded by low volatility. Post-breakout, the bands expanded, but the price has now retreated to test the middle band ($17.10). A sustained break below this level may accelerate selling toward the lower band ($14.92). The narrowing bandwidth suggests impending directional resolution.
Volume-Price Relationship
Volume trends validate key price movements. The September 11 surge (15.55%) occurred on the year’s highest volume (48.5M shares), confirming bullish conviction. Conversely, the recent two-day decline saw decreasing volume (-14% sequentially), suggesting capitulation may be nearing exhaustion. However, the absence of volume spikes during the sell-off implies weak buying interest at current levels.
Relative Strength Index (RSI)
The 14-day RSI currently reads 44.2, down from an overbought peak of 73.8 on September 12 but not yet reaching oversold territory. The swift decline from overbought conditions favors bears, and momentum remains negatively sloped. While the RSI hasn’t breached 30 to signal exhaustion, its trajectory suggests room for additional downside before potential stabilization.
Fibonacci Retracement
Applying Fibonacci levels to the August 13 low ($10.97) and September 12 high ($18.79), key retracement supports emerge. The recent pullback has breached the 23.6% level ($17.41), with the 38.2% level ($16.18) and 50% level ($15.38) acting as next supports. Confluence exists between the 23.6% Fib and the Bollinger middle band ($17.10), making $16.90–$17.40 a critical technical zone.
Confluence and Divergence Observations
Confluence of bearish signals is evident: the MACD/KDJ alignment, breakdown below the 5-day SMA, and breach of the 23.6% Fib level collectively suggest ongoing downside momentum. A critical divergence exists between price action and volume—while prices fell sharply, volume contracted, hinting at potential selling exhaustion. This conflict warrants monitoring; a decisive break below $17.00 could trigger new technical selling, whereas a recovery above $18.00 with volume expansion may signal trend resumption. Probabilistically, the weight of evidence tilts bearish near-term, but oversold oscillators and volume patterns suggest consolidation risks are rising.