Newmont Slips 3.18% As Technicals Signal Bullish Exhaustion Near Key Resistance

Newmont (NEM) experienced a notable decline of 3.18% in its most recent session, closing at $63.66. This movement occurred after significant trading activity, setting the stage for a comprehensive technical assessment across multiple indicators to gauge the stock's current trajectory and potential future direction.
Candlestick Theory
The recent price action reveals several key patterns. The large bullish candle on July 25th (+6.89%) signals strong buying momentum following a period of consolidation. However, this surge was immediately succeeded by three indecisive sessions (July 22-24) forming small body candles with upper wicks, culminating in a clear bearish engulfing pattern on July 28th. This pattern suggests potential reversal pressure. Key resistance is firmly established near $66.57 (July 25th high), with immediate support at the session low of $62.66 and more significant support likely around $61.66-$61.42, representing the consolidation zone from late July. The long upper wick on July 28th near $65.05 confirms resistance testing and rejection.
Moving Average Theory
Current dynamics show a bullish orientation but caution is warranted. The price remains above key long-term averages, indicating the primary trend favours bulls. However, potential bearish crossovers warrant monitoring. The proximity of price to the short-term average suggests increased near-term volatility is likely. The price closing significantly below both the 50-day and 100-day averages would intensify bearish pressure.
MACD & KDJ Indicators
Momentum oscillators present a complex picture. The MACD remains above its signal line but is exhibiting a potential bearish convergence as the histogram peaks diminish despite a recent price high. This divergence often precedes weakening momentum. The KDJ lines crossed downwards recently from an overbought state (K/D likely near or above 80), signalling weakening short-term bullish momentum. While not oversold yet (values remain above 50), this turn suggests increased potential for continued downward pressure or consolidation in the near term. The MACD histogram's pullback from its peak further supports this slowing upside momentum.
Bollinger Bands
Volatility analysis shows bands tightened significantly before the July 25th breakout. The decisive move above the upper band on that day signaled an overextended short-term trend. Price has subsequently retraced, moving back within the bands and testing the middle band (approximately near the 20-day SMA, around $62.50-$63.00) as potential support during the July 28th session. A decisive close below this middle band would likely indicate increasing bearish control and a potential retest of the lower band, estimated near $60.00. Band expansion potential exists if downside momentum increases.
Volume-Price Relationship
The July 25th surge occurred on significantly elevated volume, the highest in the provided data set, validating the bullish breakout move. However, the subsequent days of consolidation and the bearish reversal seen on July 28th occurred on notably lower, though still above-average, volume. This divergence between declining price and declining volume on the pullback so far is not overly bearish, suggesting the initial retreat lacks strong conviction selling. However, a subsequent down day with significantly rising volume would validate the bearish reversal signal provided by the engulfing candle and suggest stronger downside momentum.
Relative Strength Index (RSI)
Based on typical 14-day calculation, the RSI rose sharply into overbought territory (likely above 70) during the July 25th surge. It has since moderated, currently estimated around the low 60s/mid 50s as of July 28th, placing it firmly in neutral territory. While the retreat from overbought warns that the prior sharp advance was excessive, the current neutral reading offers no strong directional bias. Further downside movement would push the RSI lower, potentially approaching oversold (<30) territory if the decline accelerates, offering a warning of excessive selling pressure.
Fibonacci Retracement
Applying Fibonacci retracement to the recent significant swing low ($56.76 on June 27th) to the recent significant swing high ($66.57 on July 25th) identifies key potential support zones for the ongoing pullback. The 23.6% retracement level is near $64.76, the 38.2% near $63.47, and the crucial 50% level rests at $61.66. The 61.8% level would be near $59.86. The closing price of $63.66 on July 28th places the price very near the 38.2% retracement ($63.47). Closing below this level decisively would open the door towards testing the psychologically and technically significant 50% level ($61.66), aligning closely with the candlestick support zone identified earlier. This confluence around $61.60-$61.70 represents critical support.
Confluence Points and Divergences
Significant confluence exists around the $61.60-$61.70 level, marked as support by the July consolidation zone lows (Candlestick), the 50% Fibonacci retracement level, and a previous swing high area (pre-breakout resistance). This makes it a critical level to hold for the bullish case. Conversely, resistance is strongly evident at $66.50-$66.57. A key divergence exists between the price achieving a new recent high on July 25th and the Momentum Oscillators (MACD histogram showing lower peaks) suggesting weakening underlying buying pressure, a classic warning sign confirmed by the subsequent bearish engulfing pattern. Volume divergence (lower volume on recent pullback) offers a less dire signal for bulls currently than the candlestick and momentum oscillator warnings.
The technical outlook for Newmont suggests the strong bullish impulse initiated on July 25th may be encountering exhaustion. While the broader trend indicated by moving averages remains cautiously positive, near-term signals from price action, momentum oscillators, and confluence at Fibonacci levels point towards a probable consolidation or retracement phase. Sustained trading above $66.50 is needed to reignite strong bullish momentum. Conversely, a decisive break below the key $61.60 support level would indicate a deeper correction is underway. Volume confirmation on any directional break below support or above resistance will be crucial for assessing conviction.