Sherwin Williams Shares Drop 3.69% Amid Technical Breakdown Below Key Support

The Sherwin-Williams (SHW) fell 3.69% in the most recent session, closing at $361.38 on elevated volume. This decline extends a short-term consolidation phase following August’s peak near $375, necessitating a multi-indicator assessment of key technical levels and probable price trajectories.
Candlestick Theory
Recent price action reveals a distinct bearish engulfing pattern formed by the September 8–9 sessions, where the sharp downside candle fully consumed the prior day’s gains. This signals exhaustion near the $372 resistance level – now a critical short-term ceiling. Support emerges at $358.56 (September 9 low), aligning with the August 26 swing low of $364.97. A sustained break below this zone would expose the $352–$348 support area tested repeatedly in May and July, reflecting a critical demand threshold verified by historical reactions.
Moving Average Theory
The 50-day moving average (currently near $355) crossed bullishly above the 200-day MA in late July, confirming a structural uptrend. However, the current price hovering below the 100-day MA ($365) indicates near-term bearish pressure. Consecutive closes beneath the 100-day MA would threaten the 50/200-day bullish alignment, potentially triggering long-exit momentum. Conversely, recovery above the 100-day MA may signal resumption of the broader uptrend, especially if reinforced by volume.
MACD & KDJ Indicators
MACD demonstrates a bearish crossover, with the signal line diverging above the MACD histogram since early September, reflecting waning upward momentum. KDJ compounds this view: the %K line (27) and %D line (32) recently exited oversold territory but are now curling downward without reaching overbought levels, implying inadequate bullish conviction. This joint momentum deterioration suggests continued consolidation or downside testing unless reversed by decisive bullish volume.
Bollinger Bands
Volatility contraction is evident as bands narrowed sharply during August’s sideways movement. The September 9 close near the lower band ($358) indicates oversold conditions within the current range. A decisive break below the lower band would signal accelerating selling pressure, whereas a rebound toward the mid-band ($365) would imply mean reversion. The band width’s contraction historically precedes directional breaks – monitoring expansion is key for trend confirmation.
Volume-Price Relationship
The 3.69% decline on September 9 occurred on the highest volume in three weeks, validating bearish conviction. Notably, August rallies (e.g., August 13’s 3% gain) lacked commensurate volume, questioning upside sustainability. Recent distribution (higher volume on down days) reinforces resistance near $372, while absorption volumes near $358 would signal buyer interest. Without volume-supported reversal signs, the path of least resistance leans bearish short-term.
Relative Strength Index (RSI)
The 14-day RSI (42) remains neutral but has retreated from near-overbought (68) on September 5. Its failure to breach 70 during the August rally denotes weakening buying momentum. A breach below 30 would indicate oversold conditions, potentially offering contrarian entry opportunities if aligned with support tests. Current RSI trajectory suggests neutrality favors bears absent bullish catalysts or volume surges.
Fibonacci Retracement
Using the swing low of $308.84 (April 8, 2025) and swing high of $400.31 (November 25, 2024), key retracement levels include the 50% ($354.58) and 61.8% ($348.12) thresholds. Current trading aligns precisely with the 50% retracement – a critical psychological and technical pivot. Confluence exists here as the level intersects with horizontal support from May–July and the rising 50-day MA. Holding $354.58 may catalyze reversal attempts; failure opens risk toward $348.12, where harmonic support converges with the 200-day MA.
Confluence and Divergences
Confluence strengthens the $352–$348 support zone, merging the 61.8% Fibonacci level, 200-day MA, and multi-month horizontal volume-based support. However, a key divergence persists: KDJ’s oversold signal in late August preceded September’s sharp drop, diverging from price consolidation. Similarly, RSI’s bearish momentum divergence preceded the recent breakdown. These discrepancies underscore continued vulnerability. Traders should monitor the $354–$358 support band for directional resolution, with breaks below increasing downside probability toward $348, while recovery above the 100-day MA ($365) would realign focus on resistance near $375.