Bloomberg's 15min Chart Triggers Bollinger Bands Narrowing, Bearish Marubozu Pattern

According to the 15-minute chart of News B, the Bollinger Bands have narrowed and a bearish Marubozu pattern has emerged as of August 26, 2025 at 15:30. This suggests that the magnitude of stock price fluctuations has decreased, indicating a lack of momentum in the market. Furthermore, the bearish Marubozu pattern implies that sellers are currently in control, and it is likely that bearish momentum will continue.

As of August 21, 2025, Allstate Corporation (ALL) experienced a significant decline, falling by 3.31% to close at $206.55. This drop was accompanied by a series of bearish candlestick patterns and resistance rejection at $213, indicating persistent selling pressure. Technical indicators, including the 50/100-day Simple Moving Averages (SMAs), MACD, and Relative Strength Index (RSI), have confirmed prolonged bearish momentum. The 50-day SMA crossed below the 100-day SMA, signaling a near-term bearish trend, while the 50-day and 100-day averages are trending downward and converging toward the 200-day SMA. The MACD histogram shows increasing negative momentum, with the MACD line accelerating below zero, aligning with the KDJ indicator. The RSI nears oversold levels without bullish divergence, suggesting that the stock is experiencing significant downward pressure.

The Bollinger Bands have expanded, reflecting rising volatility after a contraction phase. The August 21 close near the lower band ($205) coincides with a band expansion, typically preceding directional moves. This marks the first close below the 20-day moving average ($210) since early August, confirming bearish momentum. Historically, tests of the lower band have triggered minor bounces, but repeated closes near this level would signal continuation of the downtrend. The bandwidth expansion from 2.5% to 3.2% over three sessions underscores increasing selling pressure.

Volume analysis reveals bearish confirmation. The 3.31% decline on August 21 occurred alongside 1.99 million shares traded—32% above the 30-day average—indicating conviction behind the selloff. This follows a pattern of distribution: rallies saw below-average volume, while recent down days attracted higher participation. The volume surge during the July 31 breakout rally now acts as a resistance reference, with subsequent reversals demonstrating insufficient buying interest to sustain advances.

The 14-day RSI reading of 38 approaches oversold territory but lacks reversal triggers. This decline from overbought conditions (RSI 72 on August 14) reflects accelerating bearish momentum. While RSI nears the 30 threshold that often precedes bounces, it has not yet established bullish divergence against price. The indicator’s steep descent from mid-August suggests underlying weakness, requiring consolidation near current levels to relieve oversold conditions before any meaningful rebound.

Applying Fibonacci retracement to the April–June rally reveals critical levels. The 61.8% retracement at $192.50 provided support in late July, but the recent breakdown below the 50% level ($196.60) shifts focus to the 78.6% retracement at $188.80. Confluence exists here as this aligns with the 200-day SMA ($195.80) and the July reaction low ($186.57). A hold above $188.80 would maintain the broader uptrend structure, while failure could retest the April low.

Multiple indicators converge to highlight $213 as formidable resistance, reinforced by the August 20 high aligning with June peaks, volume drying up near this level, and bearish rejection candlesticks. Bearish confluence also emerges at the $195–$198 zone, where the 200-day SMA, Fibonacci 78.6% level, and July swing low cluster. A notable divergence exists between price and RSI: the stock’s higher high on August 14 versus early June was not confirmed by RSI (72 vs. 68), foreshadowing the current correction. The absence of bullish divergences in MACD or KDJ suggests downside momentum may persist near-term, though oversold RSI conditions warrant monitoring for stabilization signals.

Investors should closely monitor Allstate’s stock price trend, as the bearish signal suggests potential further downward momentum. The company’s strategic initiatives may help stabilize profitability, but the current market volatility poses challenges.

References:
[1] https://www.ainvest.com/news/allstate-stock-drops-3-31-technical-indicators-signal-persistent-bearish-pressure-2508/