Estee Lauder Drops 3.30% Amid Technical Resistance At $89.86

The Estee Lauder (EL) declined 3.30% in the most recent session, closing at $85.79 after trading between $85.27 and $88.48. This price action occurs within a broader context of recovery from April 2025 lows near $50, with the stock currently consolidating near the $85-$90 zone.
Candlestick Theory
Recent candlestick patterns suggest potential near-term resistance near $89.86 (2025-07-03 high). The 2025-07-07 bearish engulfing candle, closing near its low after a rally, indicates immediate selling pressure. Key support resides at $85.27 (today's low), with a breach potentially testing $80.40 (2025-07-01 low). The two large bullish candles on 2025-07-01 (+5.33%) and 2025-07-02 (+4.08%) followed by rejection near $89 shows hesitation at higher levels.
Moving Average Theory
The 50-day moving average (MA) near $80.50 provides primary dynamic support, while the 200-day MA near $80.00 reinforces this level. The current price ($85.79) remains above all key MAs (50/100/200-day), confirming the intermediate uptrend. A bullish 50/200-day golden cross formed in June 2025, supporting the recovery thesis. However, the 3.30% drop tests the short-term MA confluence zone ($80.00-$81.00).
MACD & KDJ Indicators
The MACD shows a bearish divergence: while prices peaked near $89.86 (2025-07-03), the MACD histogram has been contracting, suggesting fading momentum. A bearish crossover signal appears imminent. KDJ readings show the K-line retreating from overbought territory (>80) near 2025-07-03, crossing below the D-line – a sell signal confirming near-term exhaustion. Both oscillators align in warning of potential consolidation.
Bollinger Bands
Bands expanded sharply during the July rally, reflecting increased volatility. Today's close near $85.79 tests the middle band (20-day SMA ≈ $85.50). A sustained break below could target the lower band near $80.50. The band width remains elevated, suggesting ongoing price volatility. This compression-rebound-expansion cycle indicates indecision after the rapid 30% advance from May lows.
Volume-Price Relationship
The rally to $89.86 was validated by rising volume (6.0-7.0M shares vs. 30-day avg ~4.5M). However, the pullback saw lower volume (4.27M) than during the advance, suggesting limited capitulation. Volume divergence at the $89 resistance – rising on down days, falling on up days in late June – signaled underlying weakness before the current retracement.
Relative Strength Index (RSI)
The 14-day RSI has retreated from near-overbought levels (68 on 2025-07-03) to current neutral readings near 55. This divergence from the price peak indicates slowing upward momentum. While not yet oversold (<30), failure to hold above 50 could signal further downside. RSI's failure to reach overbought (>70) during the July rally was a cautionary signal.
Fibonacci Retracement
Using the swing low of $51.48 (2025-04-04) to high of $89.86 (2025-07-03):
- 23.6% retracement at $80.80 aligns with the 50-day MA
- 38.2% level at $75.20 converges with the 100-day MA
The $80.80 zone offers critical support. Shorter-term Fibs drawn from the $66.94 (2025-05-30) low show the 23.6% retracement at $84.45 – today’s low held this level.
Confluence and Divergence Notes
Confluence exists between Fibonacci ($80.80), moving averages (50/200-day), and psychological support at $80.00. However, bearish divergences emerged in MACD/RSI versus price at July highs. Volume patterns and KDJ/MACD signals align in suggesting near-term consolidation, though the broader trend remains constructive above $80. Immediate focus is on whether $84.45-$85.27 support holds – a breakdown could trigger a pullback to $80.80. Upside requires clearance of $89 with volume confirmation to negate bearish momentum signals.