BHP Shares Plunge 4.3% to $53.62 as Bearish Signals Mount

BHP Group experienced notable downside pressure in the most recent session, declining 4.32% to close at $53.62. This marks the second consecutive daily loss, bringing the two-day decline to 4.35%, with elevated volume signaling conviction behind the selloff.
Candlestick Theory
The recent price action reveals significant bearish momentum. The October 10 session produced a long-bodied bearish candle closing near its low ($53.62 vs. low of $53.47), breaking below the psychological and structural support at $55.00. This level previously acted as support in early October and mid-September. Immediate resistance is now established near $56.00–$56.50, coinciding with the breakdown point and the prior day’s low. The $53.00–$52.75 zone emerges as critical support, aligning with the August consolidation range and the 200-day moving average. Failure to hold this level may trigger accelerated selling.
Moving Average Theory
A bearish bias is evident across key moving averages. The 50-day MA (~$54.52) has crossed below the 100-day MA (~$53.90), confirming deteriorating medium-term momentum. The current price ($53.62) sits below the 50-day, 100-day, and 200-day MAs ($52.20), reinforcing the near-term downtrend. This alignment suggests persistent selling pressure may continue in the short term, though the price holding above the 200-day MA indicates the broader uptrend remains technically intact.
MACD & KDJ Indicators
The MACD histogram resides in negative territory, with its signal line below zero, signaling entrenched bearish momentum. KDJ readings show %K and %D below 20, indicating severely oversold conditions. However, the absence of bullish divergence suggests the selling pressure may not yet be exhausted. While these levels often precede short-term bounces, the lack of reversal signals implies caution against premature contrarian positioning.
Bollinger Bands
Bollinger Bands are expanding significantly, reflecting heightened volatility during the current downtrend. Price has breached the lower band ($54.00), typically signaling an oversold state. However, consecutive closes near the lower band—especially on rising volume—often denote continuation potential rather than reversal. A contraction in the bands would be needed to suggest stabilization.
Volume-Price Relationship
Recent volume patterns validate bearish momentum. The selloff on October 10 occurred alongside the highest single-day volume (5.83M shares) in over two months, confirming strong distribution. This follows above-average volume during the preceding down day (October 9), indicating institutional participation. Sustained high volume on weakness suggests the decline may extend, while a reversal would require robust volume on any rebound.
Relative Strength Index (RSI)
The 14-day RSI is currently near 28, entering oversold territory. While such levels often precede technical rebounds, RSI can remain depressed during powerful downtrends. The absence of bullish divergence (e.g., higher lows in RSI against lower price lows) tempers optimism for an immediate reversal. Traders should monitor for RSI stabilization above 30 as an early reversal signal.
Fibonacci Retracement
Applying Fibonacci levels to the August 6 low ($51.54) and the October 9 high ($57.58) provides critical retracement targets. The 38.2% retracement ($55.27) was breached decisively, while the 61.8% level ($53.85) has now been violated. This places focus on the 78.6% retracement at $52.00, a level bolstered by horizontal price support from August. A rebound may encounter resistance near $53.85 (61.8%) and $54.60 (50%).
Confluence and Divergence Observations
A notable confluence of bearish signals exists:
- Price below all key moving averages with the MACD in negative territory
- Oversold KDJ and RSI readings lacking bullish divergence
- High-volume breakdown below Fibonacci and horizontal support
Significant divergence is absent among indicators, collectively aligning with near-term downside momentum. The $52.75–$53.00 zone represents a critical support cluster, where the 200-day MA, 78.6% Fibonacci level, and multi-month horizontal support converge. Failure here could trigger cascading stops, while a rebound from this region may be aided by oversold oscillators and mean-reversion dynamics.