Teradyne Shares Tumble 4.87% as Bearish Technical Signals Suggest Extended Downtrend

Teradyne (TER) has experienced a sharp 3.68% decline over two consecutive sessions, with a cumulative drop of 4.87%. This recent price action warrants a detailed technical analysis to assess potential short-term and long-term implications.
Candlestick Theory
The recent two-day bearish trend features a series of lower closes, with the most recent session closing at $185.21 after a gap down from $192.29. This forms a bearish engulfing pattern, suggesting continued downward momentum. Key support levels are evident at $185.21 (last week’s close) and $179.63 (December 1), while resistance lies at $192.29 and $194.70 (December 15 high). A breakdown below $185.21 may trigger further testing of the $175.65 support (November 4 low), with a potential target near $165.97 (November 24 low).
Moving Average Theory

The 50-day MA (approx. $190), 100-day MA ($195), and 200-day MA ($198) all sit above the current price, indicating a bearish bias. The price is now below all three, suggesting a potential continuation of the downtrend. A crossover below the 50-day MA could signal a deeper correction, while a rebound above the 100-day MA might hint at short-term stabilization.

MACD & KDJ Indicators
The MACD line (-$4.5) has crossed below the signal line (-$3.2), confirming bearish momentum, while the histogram’s expansion suggests intensifying selling pressure. The KDJ indicator shows stochastic values at 15/25, indicating oversold conditions. However, a divergence between price lows and KDJ stochastic divergence is absent, reducing the likelihood of an immediate reversal. The RSI (25) reinforces oversold territory, but caution is warranted as prolonged bearish trends can remain in oversold ranges.
Bollinger Bands
Volatility has increased, with the price trading near the lower band ($182.16–$194.57 range). The 20-day Bollinger Band width is expanding, reflecting heightened uncertainty. A bounce off the lower band could occur, but a sustained break below the $182.16 level (December 17 low) would signal a new volatility phase.
Volume-Price Relationship
Trading volume has surged during the recent decline (e.g., 3.57 million shares on December 17), validating the bearish move. However, the lack of a corresponding volume spike on the December 16 rebound (3.71 million shares) suggests weak buying interest. This asymmetry may indicate a lack of conviction among buyers, increasing the probability of further downside.
Relative Strength Index (RSI)
The RSI at 25 confirms oversold conditions, but this reading is more indicative of a potential pause than an immediate reversal. A move above 30 would require a price recovery to $192.29, while a breakdown below 25 could extend the decline to $179.63. Divergence between RSI and price action is currently absent, reducing the likelihood of a bullish reversal.
Fibonacci Retracement
Key Fibonacci levels from the December 10 high ($204.7) to December 17 low ($182.16) include 38.2% at $194.57 and 50% at $190. A rebound from the 38.2% level would align with the December 16 close, while a breakdown below the 61.8% level ($185.3) could target $175.65.
Conclusion
Confluence between bearish candlestick patterns, bearish MACD, and oversold RSI suggests a high probability of continued downside, with key support levels at $185.21 and $179.63. However, the absence of KDJ divergence or Bollinger Band contraction implies no immediate reversal signals. Traders should monitor volume dynamics and Fibonacci levels for potential short-term bounces, while a breakdown below $182.16 could signal a deeper correction.