Tencent Music Holds Near Highs At 25.48 Amid Consolidation Signals

Opening Context
Tencent Music (TME) edged down 0.16% to close at $25.48 in its latest session, continuing a phase of consolidation near recent highs. The following technical analysis synthesizes historical price dynamics across multiple indicators to contextualize the current stance.
Candlestick Theory
Recent candlesticks reveal a struggle to sustain upward momentum. After a hammer pattern on September 9 ($24.58–$25.43) signaled temporary support, the subsequent three sessions formed small-bodied candles with upper wicks near $25.63–$25.77, indicating resistance. The September 16 session printed a spinning top (open: $24.85, close: $25.48), implying indecision. Key resistance sits at the August 26 swing high ($26.28), while support converges near the September 16 low ($24.85) and the psychological $25.00 level.
Moving Average Theory
The 50-day MA ($22.80) and 100-day MA ($20.15) exhibit bullish sequencing above the rising 200-day MA ($17.95). Current price action ($25.48) holds firmly above all three MAs, confirming the primary uptrend. The 50/100-day MA golden cross in late-July 2025 remains intact, though the flattening 50-day MA suggests near-term consolidation pressure. Notably, the price has retested and rebounded from the 50-day MA multiple times since August, reinforcing its role as dynamic support.
MACD & KDJ Indicators
MACD (12,26,9) shows a declining histogram since early September, with the signal line hovering above the MACD line – indicating weakening bullish momentum but no bearish crossover yet. KDJ (9,3,3) oscillates neutrally (K: 63.1, D: 61.8, J: 65.7), avoiding overbought (>80) or oversold (<20) extremes. The lack of decisive divergence suggests continuation of the broader trend, but KDJ’s sideways drift aligns with near-term price indecision.
Bollinger Bands
Bollinger Bands (20-period) are contracting after a period of expansion during the August upswing ($22.70 to $26.28). Price currently trades near the middle band ($24.30), with upper/lower bands at $26.10 and $22.50 respectively. Reduced bandwidth signals declining volatility, often preceding directional breaks. The absence of price touches against the upper band since late August tempers overbought concerns.
Volume-Price Relationship
Volume surges validated key rallies: the 11.85% surge on August 12 (volume: 15.5M vs. 3M avg) and the 15.54% breakout on March 18 (volume: 36.5M). Recent pullbacks (e.g., September 12’s 2.42% drop) saw below-average volume, suggesting limited selling pressure. The September 16 session recorded 4.09M shares – marginally below average – reinforcing the consolidation narrative rather than distribution.
Relative Strength Index (RSI)
The 14-day RSI reads 56.1, squarely in neutral territory (30–70 band) and down from 67.5 in late August. RSI has not breached overbought (70+) since the August peak, indicating controlled upward progress. The current mid-range reading supports potential accumulation phases without immediate reversal warnings. Historical oversold signals (e.g., sub-30 in May 2025) preceded sharp recoveries, highlighting RSI’s efficacy at extremes.
Fibonacci Retracement
Applying Fib levels to the swing low of $9.41 (September 18, 2024) and high of $26.28 (August 26, 2025) yields critical retracement zones: 23.6% ($22.15), 38.2% ($19.73), and 61.8% ($16.20). The price is consolidating above the 38.2% retracement ($19.73), which aligns with the August breakout point and acts as major support. A sustained hold above $19.73 maintains the bullish structure, while the 23.6% level ($22.15) now serves as a secondary buffer.
Confluence and Divergence Synthesis
Confluence Points:
- MA alignment (50>100>200) + price above all MAs + Fib 38.2% support ($19.73) confirms the structural uptrend.
- Volume-supported rallies and low-volume pullbacks indicate healthy trend sustainability.
- Bollinger contraction + mid-range RSI/KDJ suggest equilibrium, likely resolved directionally.
Divergences:
- MACD’s fading histogram contrasts with price stability near $25.50, signaling latent bearish momentum divergence.
- The August 26 peak ($26.28) lacked corresponding RSI highs (67.5 vs. prior 71.8 in March), a mild bearish divergence.
Conclusion
Tencent Music’s technical posture favors a continuation of its primary uptrend, though near-term consolidation appears probable. Bullish confirmation would require a decisive close above $26.28 with amplified volume, potentially targeting the $28–$30 zone. Conversely, failure to hold $24.85 (September 16 low) may trigger a test of the 50-day MA ($22.80) or Fib 23.6% ($22.15), where dip-buying interest may resurge. The weight of evidence – particularly moving average sequencing and volume dynamics – remains skewed positively absent a breakdown below $22.15.