CoreWeave Stock Plummets 13.12% In Three Days Amid Technical Breakdown

CoreWeave (CRWV) has experienced a significant pullback recently, declining 7.60% in the most recent session to close at $159.50. This marks the third consecutive day of losses, resulting in a cumulative decline of 13.12% over this period. The stock has traversed considerable ground over the past year, exhibiting notable volatility.
Candlestick Theory
CoreWeave's recent price action displays a pronounced bearish reversal pattern following the peak of $187.00 on June 20th. The formation of three successive long, red (or black) candles from June 23rd to June 25th signifies persistent selling pressure. These bearish engulfing candles following the high-volume advance suggest a potential exhaustion of buyers. A key support level emerges around $155.80 (June 17th low) and $157.90 (June 25th low). Resistance is firmly established at the recent swing high of $187.00 and potentially at $180.25 (June 25th high). Failure to hold above $155-158 suggests potential for further downside. The long upper shadow on the June 25th candle ($180.25 high vs $159.50 close) strongly reinforces near-term resistance.
Moving Average Theory
Calculating key moving averages provides insight into trend positioning. The 50-day SMA resides near $135.00, while the 100-day SMA is approximately $110.00 and the 200-day SMA around $80.00. Crucially, the current price ($159.50) remains above all three major MAs, confirming the primary long-term trend as upward. However, the recent sharp decline brings the price very close to testing the 50-day SMA. Closing below this significant short-term average would signal a deterioration in the near-term trend momentum and potentially trigger further selling. The wide gap between price and the longer-term averages (100-day and 200-day) also highlights the possibility of mean reversion following the steep prior ascent.
MACD & KDJ Indicators
The MACD (12,26,9) appears to be crossing below its signal line during the recent correction, moving towards negative territory. This crossover represents a bearish signal, suggesting increasing downside momentum over the short term. The KDJ indicator (14,3,3) shows the K-line diving sharply below the D-line from near overbought levels (over 80 around the peak), with J-line plunging. All three lines are trending down significantly (K near 25, D near 35, J near 20), suggesting momentum remains firmly with the sellers. While the K and J lines are approaching oversold territory (<30), the steep trajectory implies caution – oversold conditions can persist during strong downtrends. The bearish crossovers and declining values in both MACD and KDJ strongly correlate with the pronounced price drop.
Bollinger Bands
Prior to the June high, Bollinger Bands (20-period) contracted significantly in May and early June, indicating extremely low volatility before the powerful $187 surge. The recent move above the upper band ($180+ peak) suggested a potential overextension. Price has since retreated sharply and closed below the 20-period moving average (center band), which resides near $167. The bands have started widening again during the sell-off, signaling increasing volatility, often accompanying strong directional moves. The breach of the middle band favours further downside exploration towards the lower band, currently around $145-150, which may act as the next potential support area in the near term. The shift from contraction to expansion aligns with the breakout from consolidation and the subsequent sharp reversal.
Volume-Price Relationship
The recent sell-off (June 23rd - 25th) occurred on elevated volume, particularly on June 23rd and 24th (26.4M and 18.3M shares respectively), confirming the bearish price action. This signals strong conviction among sellers driving prices lower. Conversely, the strong bullish moves during March, May, and early June (e.g., June 3rd +25.19% on 54M shares, June 17th +8.47% on 32.2M shares, June 20th +7.99% on 31.2M shares) were well-supported by high volume, validating the advance. The notable exception is the June 9th significant gain (+15.65%) on below-average volume (29.5M shares), which appeared less enthusiastic. The current decline's high volume adds significant weight to its bearish implications.
Relative Strength Index (RSI)
Based on the price swings (average gain and loss calculations), the 14-day RSI for CoreWeave has dropped sharply from near overbought levels around the $187 peak (likely above 70) into the mid-30s (approximately 32-35 as of June 25th close). This reflects a rapid shift in momentum towards the downside. While RSI is approaching oversold territory (<30), it has not yet reached that level. Historically, during its major uptrend, CoreWeave's RSI has frequently dipped into the 30s (mid-May, mid-April) before finding support and resuming its climb. Therefore, while the RSI suggests weakening momentum and the potential for a minor bounce (especially near oversold), it does not yet indicate an extreme oversold condition demanding an immediate reversal on this metric alone. The current RSI reading is consistent with a strong, short-term correction within a longer-term uptrend.
Fibonacci Retracement
Applying Fibonacci retracement levels to the significant swing from the March 31st low of $37.08 to the June 20th peak of $187.00 provides key potential support areas for this correction. The crucial levels are: 23.6% retracement at $159.76, 38.2% at $130.50, 50% at $112.04, and 61.8% at $93.58. The price closed just below the 23.6% level ($159.76) at $159.50 on June 25th, making this immediate overhead resistance. A sustained break below $159.76 opens the door to a deeper pullback towards the next significant support at the 38.2% retracement level of $130.50, potentially targeting the $140-150 range lower Bollinger Band area first. Confluence exists as the 23.6% level aligns closely with the recent $157.9-$159.5 low range identified via candlesticks and volume analysis. The 38.2% level near $130.50 also coincides roughly with the rising 100-day SMA ($110) and the psychological $130 level.
Confluence & Divergence Summary
Strong confluence of bearish signals exists across multiple indicators following the $187 peak: bearish candlestick patterns (successive large down candles), a confirmed break below the 50-day SMA nearing $135, bearish MACD crossover and KDJ plunge, high-volume selling validating the price drop, and a break below the key 23.6% Fibonacci level ($159.76). While RSI is approaching oversold and the stock is near major support areas ($155-$159) in the short term, the momentum and volume evidence favours further downside testing, with an initial target near $150 (lower Bollinger Band) and a major support zone around $130-$135 (Fibonacci 38.2% and the 100-day SMA area). Minor divergence potential exists if price stabilizes here without triggering significantly lower lows, while RSI nears oversold, but the broader confluence strongly emphasizes the prevailing downside pressure near-term.