IQVIA Shares Form Bearish Candlesticks, Death Cross and 26.84 RSI Signal Downtrend

Candlestick Theory

The recent two-day decline in IQVIA (IQV) has formed bearish candlestick patterns, including a "Bearish Engulfing" and "Two Crows," confirming downward momentum. Key support levels are identified at $189.94 (2025-09-30 close) and $186.69 (2025-09-17 close), where buying pressure historically emerged. Resistance is clustered near $205.02 (2025-10-06 high) and $206.63 (2025-10-03 high). The price has tested the $200.86 level (2025-10-07 close) as a potential short-term support, but failure to hold above this level may trigger further bearish bias.

Moving Average Theory

Short-term momentum is bearish, as the 50-day moving average (approximately $190.40) has fallen below the 200-day MA ($179.37), signaling a potential "death cross." The 100-day MA ($184.85) acts as a dynamic resistance, with the current price ($200.86) above it, suggesting intermediate-term indecision. A break below the 50-day MA would confirm a stronger downtrend, while retesting the 200-day MA could trigger a bounce. The MACD histogram (-1.100) indicates bearish momentum, with the 9-day line diverging from the price action.

MACD & KDJ Indicators

The MACD (-1.100) and signal line (-0.40) cross below zero, reinforcing bearish momentum. The stochastic oscillator (K=15, D=20) is in oversold territory, suggesting potential for a short-term rebound. However, divergence between the K line and price action (e.g., lower highs in price vs. higher lows in K) weakens the oversold signal. The RSI (26.84) confirms extreme oversold conditions but lacks immediate reversal cues due to lack of bullish divergence.

Bollinger Bands

Volatility has expanded, with the price near the lower band ($190.23), typical of oversold scenarios. A contraction in band width would signal consolidation before a breakout. The 20-day standard deviation (10.5) suggests a potential rebound to the middle band ($195.50), but bearish bias persists if the price remains below the upper band.

Volume-Price Relationship

Volume has surged on the recent decline (1.18M shares on 2025-10-07), validating the bearish move. However, decreasing volume during pullbacks (e.g., 954K shares on 2025-09-24) may indicate waning selling pressure. This mixed signal suggests caution: while the trend is bearish, a volume-driven rebound could occur if buyers emerge at key support levels.

Relative Strength Index (RSI)

The RSI (26.84) is deeply oversold, typically a buy signal. However, the absence of bullish divergence (price lows vs. RSI lows) reduces confidence in a reversal. A close above 30 would confirm a short-term bounce, but the broader bearish context (e.g., moving average crossovers) suggests limited upside.

Fibonacci Retracement

From the 2025-07-24 high ($200.82) to the 2025-08-06 low ($177.49), key retracement levels are:

- 23.6%: $192.00

- 38.2%: $193.50

- 50%: $189.16

The price has tested the 38.2% level ($193.50) twice (2025-09-09, 2025-09-10), with mixed success. A break below the 50% level would target $186.69 (61.8%), aligning with historical support.

Backtest Hypothesis

The backtest strategy of buying IQVIA when RSI <30 and exiting when RSI >30 (or 22 days pass) has shown underperformance compared to the benchmark, with a 5.18% return vs. 8.41% for the S&P 500. The Sharpe ratio (0.24) and max drawdown (0%) suggest low risk-adjusted returns, likely due to frequent false signals in volatile markets. Current RSI (26.84) aligns with the buy condition, but the confluence of bearish indicators (MACD, moving averages) implies limited upside. This highlights the need for supplementary filters (e.g., volume confirmation or Fibonacci levels) to improve strategy robustness.