Li Auto Shares Plunge 4.18% As Bearish Technicals Signal Deepening Downtrend

Li Auto (LI) closed at $23.61 on October 9, 2025, declining 4.18% on elevated volume. This latest session reinforces a developing bearish technical structure evident across multiple indicators.
Candlestick Theory
Recent price action displays significant bearish conviction. The October 9th session formed a long red candle closing near its low ($23.46 low, $23.61 close), decisively breaching the tentative support level near $24.00 established over the prior sessions (October 7th and 8th formed indecisive Doji-like candles). Resistance is now firm at the $24.80-$25.00 zone, where multiple recent highs were rejected (October 2nd, October 3rd, October 6th). The breakdown below $24.00 now marks this level as immediate resistance. Key historical support exists around $22.60-$22.65 (late August swing low).
Moving Average Theory
The moving averages confirm a pronounced downtrend across all key timeframes. The 50-day MA (~$24.50, downward sloping) acted as resistance during the brief late September bounce. More significantly, the 100-day MA (~$26.20) and the 200-day MA (~$27.80) remain decisively above the current price and are declining, signifying strong bearish momentum on both intermediate and long-term bases. The current price trading well below all three key moving averages underscores the prevailing bearish trend. The sustained order of the 50-day below the 100-day, which is below the 200-day (bearish sequence) further emphasizes structural weakness.
MACD & KDJ Indicators
The MACD (using standard 12,26,9 settings) remains entrenched below its signal line and has recently crossed below the zero line into negative territory. This signals increasing downside momentum and a confirmed bearish phase. The KDJ oscillators (standard 9,3,3) are in oversold territory (K and D potentially below 20), however, they continue to trend downwards without positive divergence. While deeply oversold conditions can occur, the absence of divergence suggests this downside momentum has not yet exhausted itself according to these oscillators, with any short-term bounce likely to face significant overhead resistance.
Bollinger Bands
The Bollinger Bands are currently expanding after a period of contraction. This reflects an increase in volatility driven strongly by the recent downside move. The price is pressing firmly against the lower Bollinger Band (~$23.20), which is expanding downwards. While technically indicating oversold territory relative to recent volatility, this condition can persist during strong trends. A close back inside the bands would be needed for tentative evidence of stabilization, but the expansion currently favors continuation of the current high-volatility downtrend.
Volume-Price Relationship
Volume patterns provide concerning signals. The latest down day (October 9th: -4.18%) occurred on significantly higher volume than the previous up day (October 8th: +1.44%). This distribution pattern indicates sellers overwhelming buyers at current levels. The substantial volume spike accompanying the sharp September 26th decline (-5.62%) represents capitulation, yet subsequent volume on rally attempts (e.g., September 29th, October 2nd) failed to exhibit convincing accumulation, leading to the latest leg down. This lack of supportive volume validates the price breakdown.
Relative Strength Index (RSI)
The 14-day RSI currently stands around 31.87, breaching the oversold threshold (<30) briefly intraday. While this technically reflects oversold conditions, potentially offering some near-term support, several factors warrant caution. Firstly, previous oversold readings in late August near this level did precede a bounce, but the technical structure (moving averages, trendlines) was less decisively bearish then. Secondly, the RSI trendline is still pointing downwards, and crucially, there is no discernible bullish divergence emerging on the daily chart at this time (price making lower lows, RSI failing to make lower lows). An RSI value below 30 is a warning but necessitates confirmation from other indicators for a reversal signal, which is currently absent.
Fibonacci Retracement
Applying Fibonacci retracement to the significant swing low of $19.10 (April 8, 2025) and the swing high of $33.12 (February 26, 2025) yields critical levels. The price has breached the major psychological and Fibonacci support near the 50% retracement level ($26.11). The 61.8% retracement sits at $24.00, a level which has recently been broken decisively (October 9th close at $23.61). This breakdown targets the next significant support near the 78.6% retracement level at $21.90. The $24.00 level, once support, now becomes major resistance. The breach of the 61.8% level significantly weakens the long-term technical structure, opening the path to test the $22.60 swing low and potentially the $21.90 Fib level. The $23.00 area also coincides with the late August consolidation low, adding confluence to that zone as potential short-term support.
In summary, Li Auto exhibits strong confluence in its bearish technical structure. The break below the $24.00 support confirmed by Candlestick patterns, below all key Moving Averages, reinforced by negative MACD and weak KDJ positioning despite oversold conditions, supported by Distribution-volume, oversold (but non-divergent) RSI, and a decisive breach of the crucial 61.8% Fibonacci retracement level. While a technical bounce may occur near the August swing low of $22.60 (confluent with the 78.6% Fib level at $21.90), the overall trend and momentum strongly favor the downside. Resistance is firmly established at $24.00 and $25.00.