Hershey Stock Plunges 4.8% to $175.42 Amid Five-Day Bearish Streak

Candlestick Theory
The Hershey (HSY) exhibits sustained bearish momentum, closing at $175.42 with a 4.80% decline on August 11, 2025, marking five consecutive down days. Recent candlesticks show long upper wicks (e.g., August 11: high $184.64 vs. close $175.42), signaling persistent selling pressure at higher levels. Key support emerges near $170–$172, aligning with the June 2025 consolidation zone. Resistance is firm at $188–$190, validated by multiple failed breakout attempts in early August. The extended downward sequence suggests entrenched bearish sentiment, with breaches below $175 potentially accelerating declines.
Moving Average Theory
HSY’s moving averages reveal a deteriorating trend structure. The 50-day MA (~$181) crossed below the 100-day MA (~$178) in late July, confirming a bearish near-term shift. The 200-day MA (~$172) now serves as critical long-term support, but the price has plunged 7.9% below its 50-day level. The widening gap between current price ($175.42) and the descending 50-day MA indicates strong downside momentum. Sustained trading below all three major averages (50/100/200-day) underscores a breakdown in bullish structure, with potential for further downside if $172 support fails.
MACD & KDJ Indicators
The MACD histogram remains in negative territory, with the signal line hovering below zero since late July. This persistent negative divergence reinforces bearish momentum. KDJ readings compound this view: The K-line (27) and D-line (31) are near oversold territory but lack upward convergence, while the J-line (-1) shows no immediate reversal signal. Both oscillators align in suggesting entrenched downside pressure, though oversold KDJ levels may foreshadow a short-term bounce if sentiment shifts.
Bollinger Bands
Volatility expanded sharply during the August decline, with the price breaking below the lower Bollinger Band ($180) on August 11. This overshoot typically precedes a mean-reversion bounce, but consecutive closes beneath the lower band indicate unusual bearish momentum. The 20-day average ($181) now acts as dynamic resistance. Band expansion alongside falling prices signals panic selling, with a consolidation phase likely needed to stabilize the trend.
Volume-Price Relationship
Recent distribution days validate bearish momentum. The August 11 sell-off occurred on 3.18M shares — 92% above the 30-day average volume — confirming institutional outflow. Downside volume has exceeded upside volume for five straight sessions, culminating in climax volume on August 11. This "capitulation volume" may exhaust near-term selling pressure, but sustained high volume below $175 would indicate renewed bearish conviction.
Relative Strength Index (RSI)
HSY’s 14-day RSI (27.1) is deeply oversold (<30), approaching levels last seen during the March 2025 correction. While this suggests exhaustion, oversold conditions can persist during strong trends. A bullish divergence would require RSI stabilization alongside further price drops, which is absent currently. Historically, RSI readings <30 in HSY preceded minor bounces within 5 sessions, but failure to reclaim 30 within three days may extend declines.
Fibonacci Retracement
Drawing from the March 2025 low ($151.29) to July 2025 high ($193.65), key Fibonacci levels frame critical thresholds. The 38.2% retracement ($177) was decisively broken on August 11, shifting focus to the 50% level ($172.47) and the 61.8% anchor at $167.85. These align with the 200-day MA ($172) and the April 2025 swing low ($167.95), creating a high-confluence support zone at $167–$172. A breakdown here could target the 78.6% retracement ($161.50).
Confluence and Divergence
Confluence of bearish signals dominates: price below all key MAs, MACD/KJ momentum deterioration, volume-backed breakdowns, and RSI capitulation. The oversold RSI and Bollinger Band overshoot offer counter-trend warning signs but lack bullish confirmation. A critical divergence emerges between record low RSI (27.1) and price ($175.42) — still above March 2025’s $151.29 low, suggesting relative underlying strength. However, decisive closes below $172 would negate this divergence, exposing $167–$161 support. Near-term bias remains bearish absent recovery above $180.