Mastercard's 3.76% Drop Extends 3-Day Slide to 6.05% as Bearish Patterns Target $540 Support

Mastercard (MA) has experienced a 3.76% decline in the most recent session, marking a three-day losing streak with a cumulative drop of 6.05%. This sharp correction suggests a potential breakdown in short-term momentum, with price action forming bearish candlestick patterns such as a bearish engulfing and hanging man near key support levels. A critical support zone appears to be forming around the $540–545 range, where the stock has historically found temporary stability, as seen in late December 2025 and mid-November 2025. Resistance levels above $560–570 are likely to remain formidable, given the repeated failures to sustain above these levels in early January 2026.

Candlestick Theory

The recent price action exhibits a bearish engulfing pattern (a large bearish candle following a smaller bullish one) and a hanging man, both signaling potential exhaustion in the short-term uptrend. The $545 level, which coincided with a prior trough on January 9, 2026, may act as a psychological floor. However, the absence of a bullish reversal pattern like a piercing line or bullish harami suggests that sellers remain in control.

Moving Average Theory

Short-term (50-day) and long-term (200-day) moving averages indicate a bearish crossover, with the 50-day MA currently below the 200-day MA, reinforcing a downtrend. The 100-day MA also sits below the 200-day MA, further confirming a bearish bias. The recent price action has remained below the 50-day MA, suggesting weak momentum and a lack of conviction in short-term buyers.

MACD & KDJ Indicators

The MACD histogram has contracted, indicating diminishing bearish momentum, while the MACD line remains below the signal line, consistent with a downtrend. The KDJ indicator (stochastic oscillator) shows the stock entering oversold territory (below 30), with the %K line crossing below the %D line—a bearish signal. However, a divergence between the KDJ and price action is emerging: while the RSI and stochastic oscillator suggest oversold conditions, the price continues to decline, hinting at a potential continuation of the downtrend rather than an immediate reversal.

Bollinger Bands

Volatility has expanded recently, with the bands widening as the stock’s price approaches the lower band. This contraction and expansion pattern suggests a potential breakout or breakdown. The current price near the lower band ($545) may test its validity as support, but a break below this level could trigger a retest of the $530–535 range, which was a prior support in late December 2025.

Volume-Price Relationship

Trading volume has surged during the recent decline, validating the bearish move. High volume during downward price action typically signals strong selling pressure, increasing the probability of a continued decline. However, if volume diminishes while the price remains near $545, it could indicate waning bearish momentum and a potential consolidation phase.

RSI

The RSI has dipped into oversold territory (<30), suggesting a potential short-term bounce. However, given the prolonged bearish trend and the absence of a bullish divergence, this oversold condition is more indicative of a deepening downtrend rather than an immediate reversal. A sustained close above $555 would be necessary to alleviate oversold concerns, but the current price trajectory suggests this is unlikely in the near term.
Fibonacci Retracement
Applying Fibonacci retracement from the January 9, 2026, high of $581.31 to the January 13, 2026, low of $533.7, key levels include $557.5 (61.8% retracement) and $545.5 (50% retracement). The current price near $545 aligns with the 50% level, which could act as a temporary support. A break below this level would target the $530–535 zone, while a rebound above $557.5 may signal a bearish exhaustion phase.

Confluence and Divergences

Multiple indicators concur on a bearish bias: the moving averages, MACD, and volume all support continued downward pressure. However, the RSI and stochastic oscillator’s oversold readings create a divergence, suggesting the market may be overcorrecting. A key confluence point is the 50% Fibonacci level at $545, which, if held, could trigger a short-term bounce. Conversely, a break below this level would align with the bearish case, with the next target at $530.