Capital One Extends Losses 1.86% As Bearish Technicals Test Key 192 Support

Capital One Financial (COF) declined 0.45% in the latest session to $192, extending losses to 1.86% over two consecutive down days amid below-average volume of 2.56 million shares. This retreat occurs within a broader technical context requiring multi-indicator assessment.
Candlestick Theory
Recent sessions show a Bearish Engulfing pattern forming on June 3rd and 4th, where a strong white candle ($191.46 close) was followed by a larger red candle closing near its low ($192.86), signaling rejection near the $197 psychological resistance. The subsequent decline validates this resistance, with $190.85 emerging as immediate support from June 5th’s low. Historical congestion near $186 (tested May 30th and June 2nd) provides secondary support.
Moving Average Theory
The 50-day MA (currently ∼$184) maintains an upward slope below price action, confirming the primary uptrend since October 2024. However, the price recently crossed below the 100-day MA ($193.50), while the 200-day MA ($168) offers long-term support. This compression between the 50-day and 100-day MAs reflects near-term consolidation pressure, with a sustained break below $190 potentially accelerating selling toward the 50-day support.
MACD & KDJ Indicators
MACD registers a bearish crossover below its signal line, with histogram bars extending negatively since June 4th, confirming fading momentum. KDJ’s %K (20) and %D (32) plunge toward oversold territory but lack bullish convergence. While both oscillators indicate downward pressure, MACD’s strengthening negative divergence suggests higher-probability continuation of the current retracement phase before stabilization occurs.
Bollinger Bands
Bands constricted notably in late May (bandwidth narrowed 15%), preceding the June breakdown below the 20-period SMA (middle band). Price now hugs the lower band ($190), indicating oversold conditions but also high directional conviction to the downside. A closing break beneath $190 could trigger volatility expansion, targeting the May swing low of $186.46. Band contraction near current levels may precede a technical bounce.
Volume-Price Relationship
The two-day decline occurred on diminishing volume (-35% vs. June 3rd’s rally volume), suggesting limited conviction in the downturn. However, May 30th’s distribution (6.18M shares on a down day) established overhead supply. Sustained moves above $195 would require validation through volume expansion beyond the 50-day average (∼3.8M shares) to confirm renewed accumulation.
Relative Strength Index (RSI)
The 14-day RSI (45) retreated from near-overbought levels (68 on May 19th) but holds above oversold thresholds. While the current reading implies neutral momentum, the oscillator’s failure to breach 70 during May’s highs demonstrated weakening bullish momentum. A drop below 40 would reinforce near-term bearish control, though divergence could form if price stabilizes before RSI reaches oversold territory.
Fibonacci Retracement
Applying Fib levels between the March low ($159) and June high ($199.47) shows the current pullback testing the 23.6% retracement ($192.50). Confluence exists here with the 100-day MA and psychological $192 support. A decisive break risks testing the 38.2% level ($185.25), aligning with the May 30th swing low and 50-day MA. The 61.8% retracement ($177.50) remains the critical bull market defense level.
Confluence and Divergence Observations
Confluence appears at $190–$192.50 (23.6% Fib, 100-day MA, Bollinger lower band) as pivotal support. A breakdown would align MACD’s bearish momentum, KDJ’s oversold readings, and volume-based resistance near $195. Key divergence exists between RSI’s neutral stance and KDJ’s oversold signal—monitoring for RSI confirmation of KDJ’s extremity would strengthen reversal signals. Probabilistically, near-term consolidation appears more likely than an immediate bullish reversal given MA compression and volume lethargy, though oversold Bollinger conditions suggest limited downside from current levels without new catalysts.