Tencent Music Slides 4.39% Amid Heavy Selling Pressure Technicals Signal Further Downside Risk

Tencent Music (TME) declined 4.39% in the latest trading session (2025-10-10), closing at 22.43 after ranging between 22.22 and 23.74. This movement occurred on elevated volume of 7.62 million shares, suggesting intensified selling pressure as the stock retreated from recent highs. The following technical analysis synthesizes multiple indicators to assess the current market structure.
Candlestick Theory
Recent candlesticks reveal a bearish rejection at the 23.74 resistance level. The 10/10 session formed a long red candle engulfing the prior two days’ gains, signaling strong selling pressure near the 23.50–23.75 zone. This area now constitutes immediate resistance, having capped prices twice in October. Support emerges near 22.20–22.40, aligning with August swing highs and the 10/10 low. A decisive close below 22.20 would invalidate this support, potentially triggering further downside toward 21.30.
Moving Average Theory
The 50-day MA (currently ~23.80) crossed below the 100-day MA (~24.40) in late September, confirming a bearish medium-term trend. Prices now trade below all key SMAs (50/100/200-day), with the 200-day MA at 17.80 providing distant support. The sequential ordering of 200-day > 100-day > 50-day > current price reflects entrenched bearish momentum. Recent bounces have failed near the 50-day MA, reinforcing its role as dynamic resistance.
MACD & KDJ Indicators
MACD (12,26,9) remains in negative territory below its signal line, though the histogram shows diminishing bearish momentum. KDJ readings (28 K / 35 D / 13 J) indicate oversold conditions, with the J-line dipping below 20. This divergence suggests weakening downward pressure despite the price decline. However, neither oscillator shows bullish reversal confirmation, requiring MACD crossover or KDJ upward thrust for credible buy signals.
Bollinger Bands
The bands contracted sharply in September, preceding the recent breakdown below the lower band. Prices remain near the lower band (21.80–22.20), indicating ongoing bearish pressure. Bandwidth has expanded 15% since October began, reflecting rising volatility. Sustained trading below the lower band would suggest oversold conditions, but a close back inside the bands is needed to signal stabilization.
Volume-Price Relationship
The 4.39% decline on 10/10 occurred on 39% above-average volume, confirming distribution. Notable volume spikes accompanied key turning points: the 8/12 11.85% rally on 15.5M shares signaled institutional accumulation, while the 9/18 4.06% drop on 10.3M shares marked distribution. Current volume patterns lack capitulation signs seen at prior lows (e.g., 5/14 15.66% surge on 21.9M shares), suggesting sellers remain in control.
Relative Strength Index (RSI)
The 14-day RSI at 32 approaches oversold territory but hasn’t breached the 30 threshold that historically triggered rebounds (e.g., May 2025 low at RSI 28). Bearish divergence is evident as October’s lower price lows haven’t been matched by lower RSI lows. While this warns of downside exhaustion, RSI must exceed 40 to suggest waning bearish momentum.
Fibonacci Retracement
Using the June low (16.84) and September high (26.445), key retracement levels are:
- 23.6%: 24.60 (tested as resistance in October)
- 38.2%: 22.90 (recent breakdown level)
- 50%: 21.64 (next major support)
- 61.8%: 20.38 (alignment with 200-day MA)
The breakdown below the 38.2% level (22.90) opens a path toward 21.64. The 50% retracement converges with the August swing high (21.89), creating a high-probability support zone.
Confluence and Divergence Observations
Significant confluence exists at 21.60–21.90, combining the Fibonacci 50% retracement, August resistance, and 10/06 swing low. Bullish divergences appear as KDJ and RSI show diminishing downside momentum against lower price lows. However, bearish consensus dominates with price below key MAs, descending volume profile, and rejection at Fibonacci resistance. Traders should monitor the 22.20–22.40 support zone; failure here could accelerate declines toward 21.60, while recovery above 23.20 may trigger short-covering toward the 50-day MA.