Shinhan Financial Drops 5.21% as Technicals Signal Bearish Momentum Below Key 48 Support

Shinhan Financial Group (SHG) declined 5.21% in the most recent session, closing at 48.26 after trading between 47.90 and 48.81. This analysis employs multiple technical frameworks to assess the security’s trajectory.
Candlestick Theory
Recent price action shows SHG breached the critical 50.00 psychological support, establishing a new resistance level at 52.00 (July 25 high). The breakdown below 50.00 was decisive, with the current price testing the 48.00–47.90 support zone, which aligns with June’s consolidation range. A confirmed close below 47.90 would expose the 45.00–46.00 structural support.
Moving Average Theory
The 50-day SMA (approximately 45.00) remains above the 100-day (≈42.00) and 200-day SMA (≈38.50), preserving the long-term bullish sequence. However, the sharp decline has pulled prices below the 20-day dynamic support, suggesting short-term bearish momentum. The 48.26 close now tests the 50-day SMA’s upper range; sustained trading below this level may signal accelerating downside pressure.
MACD & KDJ Indicators
MACD exhibits a bearish crossover, with the signal line diverging below the MACD line, reflecting increasing downward momentum. KDJ confirms this shift, with the %K line (25.2) and %D line (38.5) trending downward from overbought territory (>80) after peaking on July 25. Both oscillators align in signaling weakening bullish momentum but have not yet reached oversold extremes (<20).
Bollinger Bands
Volatility expansion is evident as prices breached the lower Bollinger Band (approximately 48.00) after a prolonged period of band contraction in late July. This breakout suggests accelerated selling pressure. Historical precedent indicates such expansions often precede short-term reversals, but confirmation requires price recovery above the lower band.
Volume-Price Relationship
Volume surged 31.6% during the 5.21% decline, confirming bearish conviction. This distribution pattern contrasts with the 7% rally on July 8, which saw 41.4% higher volume than the 30-day average. Current volume behavior validates the breakdown, though climactic selling (volume > 300% average) is absent, suggesting potential continuation pressure.
Relative Strength Index (RSI)
RSI (14-period) has retreated to 42.8 from an overbought 74.1 on July 25. While this descent reflects strengthening bearish momentum, it remains above the 30 oversold threshold. The current reading implies room for further downside before triggering traditional oversold reversal signals. Caution is warranted, given RSI’s tendency to generate false signals during strong trends.
Fibonacci Retracement
Applied to the 40.56–52.00 upswing (June 3–July 25), key retracement levels are:
- 23.6%: 49.30 (breached decisively)
- 38.2%: 47.63 (current test)
- 50.0%: 46.28
The 47.90 low precisely tests the 38.2% retracement, a critical Fibonacci support. Confluence with June’s horizontal support strengthens this level’s technical significance.
Confluence and Divergence Observations
Confluence exists at 47.60–48.00, where Fibonacci, horizontal, and Bollinger Band support converge. However, volume divergence emerged as prices fell: recent distribution volume remains below the July 8 accumulation spike, suggesting insufficient capitulation to complete a reversal. Bearish unanimity appears across momentum oscillators (MACD, KDJ, RSI), with no counter-indications from volatility or moving averages.
In summary, SHG faces critical support at 47.60–48.00, where technical elements suggest potential stabilization. However, bearish confirmation across volume and momentum indicators implies further testing of lower supports near 46.28 (50% retracement) may precede reversal initiation. A recovery above 50.00 would be required to invalidate the immediate downtrend bias.