Zoom Stock Extends Slide With 3% Drop As Bearish Signals Intensify

Zoom Communications (ZM) fell 3.01% to $75.05 on July 10, 2025, marking its second consecutive daily decline with a cumulative 3.06% loss amid higher volume. This extended the stock's persistent downtrend below critical moving averages.
Candlestick Theory
The recent price action reveals a bearish continuation pattern. The July 10 closing price near its low ($75.05 vs. intraday high $77.59) formed a long upper-wicked candle, confirming rejection around the $78 psychological resistance. This level has solidified as resistance after repeated failures to breach it since mid-June. Support is emerging near $75.00 (June 24 low) with stronger historical support at $72.60, aligning with the April 2025 consolidation zone. The consecutive red candles on expanding volume signal sustained selling pressure.
Moving Average Theory
The 50-day, 100-day, and 200-day moving averages exhibit a bearish alignment, all trending downward with the price below each. The 50-day SMA ($78.20) and 200-day SMA ($78.70) recently converged to form a resistance ceiling near $78.50, which capped price advances during early July. A sustained break below the long-term moving averages suggests entrenched bearish sentiment, with all timeframes now signaling a downtrend.
MACD & KDJ Indicators
MACD remains below its signal line in negative territory, with the histogram expanding negatively since late June – signaling strengthening downward momentum. KDJ shows the K-line (24.3) and D-line (30.7) plunging below 30, indicating oversold territory. While this often precedes reversals, no bullish crossover is yet evident, suggesting momentum remains skewed downward. The persistent MACD downtrend outweighs KDJ's oversold reading currently.
Bollinger Bands
Price closed near the lower Bollinger Band ($75.10) with bands expanding, reflecting increasing volatility and directional downside momentum. The 20-period average ($77.80) aligns with recent resistance. Contraction between June 25-30 preceded the current breakdown. Closing below the lower band for two sessions may foreshadow a temporary oversold bounce, but a sustained position here emphasizes bearish control.
Volume-Price Relationship
Distribution days have dominated since the $82.27 peak on May 21, with notably higher volume accompanying declines (e.g., July 10: 3.6M shares vs. 30-day avg ~2.9M). The July 10 volume surged 22% above the prior session, confirming bearish conviction. Conversely, up days consistently show below-average volume, indicating weak buying interest. This volume asymmetry validates the downtrend’s sustainability.
Relative Strength Index (RSI)
The 14-day RSI at 29 signals deeply oversold conditions. Historically, similar RSI troughs (e.g., April 10: RSI 30) preceded tactical rebounds. However, the indicator has remained <50 since late June, affirming a negative momentum backdrop. While an oversold bounce may be imminent, RSI lacks bullish divergence versus price on daily charts, limiting reversal conviction.
Fibonacci Retracement
Applying Fibonacci levels to the rally from April’s $67.75 low to March’s $85.17 peak reveals key thresholds. The 50% retracement ($76.46) was breached decisively on July 10. Consecutive closes below this level open the path toward the 61.8% retracement at $73.60, aligning with the April consolidation range. The 38.2% level ($79.35) now acts as resistance, coinciding with the 200-day SMA.
Confluence & Divergence Summary
Confluence points are predominantly bearish:
- Resistance at $78 combines 200-day SMA, Fibonacci 38.2%, and horizontal price resistance.
- Oversold signals (RSI <30, lower Bollinger Band touch) face countervailing evidence from MACD momentum and volume-backed breakdowns.
Notably, a key bullish divergence is absent: RSI and MACD have not printed higher lows against lower price lows during this downtrend phase. A decisive break below $75.00 may accelerate selling toward the $73.60–$72.60 support cluster (Fibonacci 61.8% + April lows), while any recovery needs to reconquer $78.00 to neutralize immediate bearish bias.