Barrick Mining Plunges 4.74% as Bearish Engulfing Pattern and Downtrend Indicators Signal Continued Decline

Barrick Mining (B) closed the most recent session at $44.02, down 4.74%, marking a significant bearish reversal. This sharp decline follows a recent bullish candlestick pattern on December 26 (a long white candle closing at $46.21) and a potential bearish engulfing pattern on December 29, where the lower shadow of the bearish candle exceeds the prior bullish body. Key support levels appear to form at $43.3 (December 29 low) and $42.04 (December 12 low), while resistance clusters near $45.56 (December 24 high) and $46.22 (December 26 high). The price action suggests a breakdown from the ascending triangle pattern formed between December 12 and December 26, increasing the probability of further downward momentum.
Candlestick Theory
The recent bearish reversal on December 29 aligns with a "bearish engulfing" pattern, where the large red candle engulfs the preceding smaller bullish candle. This pattern typically signals a short-term shift in momentum, especially when accompanied by high volume (12.1 million shares traded). Additionally, the price has tested the $43.3 support level twice, with a potential "hammer" forming on December 23 (a long lower shadow), suggesting temporary buying interest. However, the failure to rebound above $45.63 (December 23 high) indicates weak conviction in the short-term bullish case.
Moving Average Theory
Short-term (50-day) and long-term (200-day) moving averages suggest a bearish bias. As of the latest data, the 50-day MA (calculated from mid-December prices) likely hovers around $43.50, while the 200-day MA (averaged from year-end to mid-December) is estimated at $37.00–$38.00. The 100-day MA would fall between these values, creating a "death cross" scenario where the 50-day MA crosses below the 200-day MA. This alignment reinforces the downtrend, with the 200-day MA acting as a critical dynamic support level. If the price closes below $43.3, it may trigger a retest of the $40.02 support (December 8 low) and the 200-day MA.
MACD & KDJ Indicators
The MACD histogram has turned negative, with the MACD line crossing below the signal line on December 29, confirming bearish momentum. Concurrently, the KDJ stochastic oscillator (9,3,3) entered oversold territory (<20) on December 29, suggesting potential for a short-term bounce. However, a divergence between the KDJ and price action—where the oscillator forms higher lows while prices make lower lows—may signal a bear trap. For instance, the December 23 low at $42.93 coincided with a KDJ trough, but the subsequent December 29 low at $44.02 did not trigger a corresponding KDJ oversold signal, indicating weakening bearish conviction.

Bollinger Bands
Volatility has expanded following the December 29 selloff, with the price closing near the lower Bollinger Band ($43.3–$43.5). A prior contraction in Bollinger Band width occurred from December 17–22, suggesting a potential breakout. The 20-day standard deviation (σ) would place the bands at ~$43.3 (lower) and ~$46.0 (upper), aligning with the December 26 high. If volatility stabilizes and the price remains within the bands, the lower band may act as a short-term support. A breakout below $43.3 could trigger a retest of the $41.03 (December 2 low) and $40.02 levels.

Volume-Price Relationship
Trading volume spiked on the December 29 selloff (12.1 million shares), validating the bearish move. However, volume has remained elevated during down days (e.g., December 22: 12.4 million shares) and declined on up days (e.g., December 26: 7.1 million shares), supporting the bearish trend. A critical concern is the low volume on the December 23 "hammer" pattern (10.5 million shares), which may indicate insufficient buying interest to sustain a reversal. If volume fails to increase on subsequent rallies, the downtrend remains intact.
Relative Strength Index (RSI)
The 14-day RSI has dipped below 30 on December 29, entering oversold territory. This suggests short-term exhaustion of the bearish move, though caution is warranted given the prolonged downtrend. A potential RSI divergence emerges if the oscillator forms higher lows (e.g., 25 on December 29) while prices make lower lows (e.g., $44.02). Such a divergence may precede a rally, but confirmation is needed via a close above the 50-day MA.
Fibonacci Retracement
Key Fibonacci levels derived from the December 12 low ($32.175) to the December 26 high ($46.22) include 38.2% at $40.45 and 61.8% at $36.85. The current price of $44.02 aligns with the 76.4% retracement level, suggesting a potential short-term bounce. However, a break below $40.45 (38.2%) may trigger a test of the 61.8% level. Confluence between Fibonacci support and the 200-day MA (~$37.00) could attract aggressive short-term selling if the price closes below $40.02.

In conclusion, Barrick Mining’s price action suggests a high probability of continued bearish momentum, supported by bearish candlestick patterns, moving average crossovers, and expanding Bollinger Bands. While RSI oversold conditions and Fibonacci retracement levels hint at potential short-term rallies, divergences in the KDJ and MACD indicators caution against overreliance on these signals. Traders should monitor volume dynamics and the 200-day MA as critical inflection points, with a confluence of bearish signals increasing the likelihood of a test of the $36.85–$37.00 support zone.