D R Horton Drops 3.35% As Bearish Signals Emerge Near Resistance

D.R. Horton (DHI) declined 3.35% in the latest session (2025-09-09), closing at $177.88 after reaching an intraday high of $183.08 and low of $176.21 on elevated volume of 3.83 million shares. This analysis examines the technical posture of DHI using multiple methodologies.
Candlestick Theory
The recent price action culminated in a bearish engulfing pattern on September 9, as DHI’s 3.35% decline fully consumed the prior session’s gains. This formation, occurring near the $184.55 resistance level established on September 8, signals rejection at this upper boundary. Support now resides at $176.21 (September 9 low), with secondary support near $172.17 (September 3 close). A sustained break below $172.17 would expose the psychological $170 level.
Moving Average Theory
The 50-day SMA (approximately $173.40) has provided dynamic support during DHI’s uptrend from April lows. The current price ($177.88) remains above the 50-day, 100-day (~$164.80), and 200-day SMAs (~$150.20), confirming the primary uptrend. However, the narrowing spread between the 50-day and 100-day SMAs suggests moderating momentum. The 50-day SMA’s proximity to current price action makes it a critical level; sustained trading below this average would signal near-term weakness.
MACD & KDJ Indicators
The MACD histogram has turned negative in recent sessions, reflecting diminishing upward momentum as the MACD line crossed below its signal line. This bearish crossover aligns with the KDJ indicator, where the %K line (32) has plunged below %D (62) from overbought territory (above 80). While both oscillators signal short-term bearish pressure, they remain above extreme oversold thresholds. Notably, the MACD’s bearish divergence since early September — where price made higher highs while MACD declined — warned of potential reversal.
Bollinger Bands
Bollinger Bands expanded during the August rally, reflecting increased volatility as DHI tested the upper band near $184. The subsequent retreat to the midline (~$178) indicates consolidation. Current price position near the midpoint neither confirms bearish nor bullish bias, but the bandwidth’s stabilization suggests reduced near-term volatility. A decisive break below the midline would target the lower band near $172.
Volume-Price Relationship
The September 9 decline occurred on above-average volume (3.83M shares vs. 30-day avg ~3.5M), lending credibility to the bearish move. However, the broader uptrend is validated by substantial volume spikes accompanying key breakout days — particularly the July 22 surge (13.1M shares, +17%). Distribution patterns are absent, though the recent high-volume pullback warrants monitoring for follow-through selling.
Relative Strength Index
The 14-day RSI (54) has retreated from near-overbought conditions (73 on September 5) but remains above the 50 midpoint. This reflects moderating bullish momentum without triggering oversold alarms. The RSI’s lower high pattern against price’s September peak aligned with MACD’s bearish divergence. While not yet signaling oversold conditions, additional weakness could push RSI toward the 40–50 support zone historically observed during pullbacks.
Fibonacci Retracement
Using the swing low of $115.10 (April 8) and peak of $184.55 (September 8), key retracement levels include $169.64 (23.6%), $161.48 (38.2%), and $149.83 (50%). The current price ($177.88) sits comfortably above the 23.6% level, indicating a shallow retracement relative to the broader uptrend. Confluent support emerges near $169–$171, where the 23.6% Fib level aligns with the 50-day SMA and the August consolidation zone.
Confluence and Divergences
Confluence at $170–$172 (50-day SMA, psychological support, and the 23.6% Fib level) creates a high-probability support zone. Bearish consensus emerges from the MACD/KDJ crossovers, candlestick rejection at resistance, and volume-confirmed pullback. Divergence between price strength (higher highs) and momentum oscillators (lower highs) in early September provided an early reversal alert. The overall technical structure remains bullish long-term, but short-term indicators suggest continued consolidation or moderate downside toward key support areas. A recovery above $180.00 would neutralize immediate bearish pressure, while a breach of $184.55 would reinvigorate the uptrend.