ServiceNow Plunges 10.14% With Bearish Signals Across Key Technical Indicators

ServiceNow (NOW) Technical Analysis
Candlestick Theory
ServiceNow exhibits a pronounced bearish sequence with five consecutive down days, culminating in a 10.14% decline. The July 11 session closed near its low ($938.78) after testing intraday resistance at $966, forming a bearish continuation pattern. Key resistance is now established at $966–$970 (recent highs), while critical support rests near $934 (July 11 low). A break below $934 could trigger accelerated selling, whereas sustained closes above $970 may signal stabilization. The consistency of long red candles reflects robust selling pressure with limited bullish rejection signals.
Moving Average Theory
The 50-day moving average (MA) has crossed below the 100-day MA, confirming a bearish near-term structure. Current price ($938.78) trades below all three major MAs (50-day ≈ $990, 100-day ≈ $1,010, 200-day ≈ $850), indicating strong downside momentum. The widening gap between the 50-day and 200-day MAs suggests accelerating bearish momentum. While the 200-day MA remains upward-sloping (supporting the longer-term uptrend), sustained trading below the 100-day MA underscores persistent near-term weakness.
MACD & KDJ Indicators
The MACD histogram deepens in negative territory, with the signal line diverging further below the zero line, confirming bearish momentum acceleration. Concurrently, the KDJ oscillator shows an oversold reading (K and D lines near 15), but without a bullish crossover. This divergence—where momentum indicators reach extremes without immediate reversal—suggests persistent downside pressure. The lack of a KDJ bullish crossover amid oversold conditions may indicate delayed stabilization signals.
Bollinger Bands
Bollinger Bands have expanded sharply during the recent sell-off, reflecting heightened volatility. Price has consistently traded below the lower band (approx. $950) for three sessions, indicating an extreme oversold condition historically associated with short-term reversals. However, consecutive closes beneath the lower band imply continued directional pressure. A move back inside the bands (above $950) would be the first technical requirement for potential mean reversion.
Volume-Price Relationship
Elevated volume during the five-day decline (notably July 10–11 exceeding 2 million shares) confirms strong distribution. Downside volume has consistently outpaced upside volume over the past month, validating the bearish trend. The absence of accumulation signals—despite oversold readings—suggests insufficient institutional buying interest to stabilize the decline. A bullish reversal would require significantly higher volume on an up day than observed in recent rebounds.
Relative Strength Index (RSI)
The 14-day RSI calculates to 23, deep in oversold territory (<30). Historically, this signals potential exhaustion in selling pressure. However, the RSI has remained suppressed below 30 for three consecutive sessions without triggering a bounce—a rare occurrence that may indicate capitulation. While the extreme reading suggests heightened rebound probability, its persistence below 30 aligns with historical instances where oversold markets continued sliding before reversing.
Fibonacci Retracement
Applying Fibonacci levels to the rally from the April 24 low ($938.57) to the January 28 peak ($1,170.39), key retracement levels emerge. The 38.2% retracement ($1,080) and 50% level ($1,054) were breached decisively. Current prices test the critical 61.8% retracement at $934—a confluence zone with July 11’s low. A sustained break below $934 would expose the 78.6% level near $875. This Fibonacci support aligns with the $934 candlestick support, creating a pivotal technical floor.
Confluence & Divergence Observations
Confluence of bearish signals appears across MACD, moving averages, and volume, confirming robust downside momentum. Divergence emerges between oversold oscillators (RSI at 23, KDJ at extreme lows) and ongoing price deterioration, often preceding reversals. The $934 zone represents critical technical confluence—housing both the Fibonacci 61.8% level and recent price low—making it a decisive battleground. A rebound from $934 with expanding volume would signal a high-probability countertrend opportunity, while failure here could extend declines toward $875. The alignment of Bollinger Band oversold extremes and RSI capitulation readings enhances reversal prospects near support, though confirmation requires bullish candlestick patterns and volume validation.