Natwest Shares Plunge 6.34% to 13.01 Amid Technical Breakdown

Natwest Group shares declined 6.34% to close at 13.01 on the latest session, marking the second consecutive day of significant losses with a cumulative 8.06% drop. This sharp descent follows a broader downtrend from recent highs near 14.50 in mid-June. Below is a comprehensive technical analysis integrating multiple methodologies.
Candlestick Theory
Recent sessions exhibit strong bearish momentum. The last two days formed large red candles closing near session lows, indicating persistent selling pressure. A clear support zone emerges around 12.85-13.00, aligning with March 2024 consolidation levels. Resistance is evident near 13.80-14.00 (prior minor support) and more significantly at the 14.15-14.30 area (June highs and neckline of a potential head-and-shoulders top pattern).
Moving Average Theory
The price has decisively broken below the 50-day MA (~13.60) and 100-day MA (~13.45) during the recent sell-off, confirming short-term bearish control. Crucially, the 200-day MA (~10.80) remains well below the current price, suggesting the longer-term uptrend from mid-2024 lows is still intact structurally. However, the shorter-term MAs are now in a bearish configuration, with the 50-day crossing below the 100-day recently, adding downward pressure.
MACD & KDJ Indicators
The MACD line (12,26,9) is deep in negative territory below the signal line, confirming strong bearish momentum. There are no immediate signs of a bullish crossover. The KDJ indicator (9,3,3) shows K (16.3) and D (24.1) deep in oversold territory (<20), while J (-0.5) is extremely compressed. This suggests the downtrend is significantly overextended short-term and warrants caution for new shorts. However, oversold readings can persist during strong trends.
Bollinger Bands
Price has breached the lower Bollinger Band (~13.25, 20-period, 2 Std Dev), reflecting heightened downside volatility. Bandwidth has expanded significantly during the decline, confirming strong directional momentum. While a breach below the lower band often precedes a mean-reversion bounce, the persistence of the move combined with volume suggests follow-through risk. A sustained move back inside the bands is needed to signal potential stabilization.
Volume-Price Relationship
The sharp decline was confirmed by a significant surge in trading volume on 2nd July (over 11.5M shares vs. ~4M average), indicating strong distribution (supply overwhelming demand). Recent high-volume down days contrasted with lower volume on minor up days in late June points to institutional selling pressure. This validates the bearish price action and increases the likelihood of further downside before a sustainable bottom forms.
Relative Strength Index (RSI)
The 14-day RSI has plummeted to approximately 24.4, deeply within oversold territory (<30). While historically, such extreme readings can precede technical rebounds, RSI is a warning indicator, not a timing tool. Bear markets often see RSI remain depressed. It signals the selling may be exhausted in the near term, but trend confirmation is required before anticipating a reversal. Caveats about divergence (not present currently) and trend strength apply.
Fibonacci Retracement
Applying Fibonacci retracement to the key upswing from the March 2024 low (~8.50) to the June 2025 high (~14.50):
38.2% level: ~12.35 (Minor Support)
50.0% level: ~11.50 (Significant Support)
61.8% level: ~10.65 (Major Support)
Current price (13.01) is testing an extension of the prior swing low and psychological support near 13.00, slightly above the 23.6% retracement level. The confluence of the psychological 13.00 level and the structure-based support makes this a critical zone. A decisive break below targets the 38.2% level near 12.35.
Confluence & Divergences
Confluence: Bearish confluence is strong. The breakdown below multiple MAs, deep MACD negative territory, high-volume selling, price below lower Bollinger Band, and oversold (but lagging) RSI/KDJ readings collectively signal strong downside momentum. The 13.00 area represents a major confluence point (price structure support, psychological level).
Divergences: Crucially, no bullish divergence is yet evident. Price is making lower lows alongside MACD and RSI lows. KDJ oversold is notable but not a divergence per se. The lack of divergence, especially in MACD, suggests the current downtrend remains intact without underlying weakness in the bearish momentum. The significant volume on the drop further undermines any nascent bullish signals from oversold oscillators.
Conclusion
Natwest Group exhibits intense bearish momentum, validated by volume, moving averages, MACD, and Bollinger Bands. While deeply oversold short-term readings (RSI ~24, KDJ <20) increase the probability of a technical bounce or consolidation near the critical 13.00 support zone, the absence of bullish divergences and the strength of the volume-driven decline suggest limited near-term upside potential. A sustained break below 13.00 opens the path towards the 12.35 (38.2% Fib) and potentially 11.50 (50.0% Fib) support areas. Any recovery attempt faces immediate resistance near 13.80-14.00. Traders should await confirmation of trend exhaustion (e.g., a bullish reversal candle with volume, MACD crossover, and price reclaiming key MAs) before considering counter-trend positions. The long-term trend remains technically bullish above the rising 200-day MA.