TKO Group Stock Drops 3.21% Amid Bearish Technical Signals

TKO Group Holdings (TKO) closed at $195.79 in its most recent session, reflecting a decline of 3.21%. The following technical analysis evaluates the stock's position across multiple indicators based on approximately one year of daily price data.
Candlestick Theory
The recent price action for TKO Group Holdings shows a potential bearish engulfing pattern formed on September 24th, where a strong down candle (open $202.98, close $195.79) engulfed the previous session's gains, suggesting seller dominance near the $202-$203 resistance zone. Key support is identified around the $180-$182 area, evidenced by a significant swing low and high-volume rejection in August 2025. The $195-$198 region served as consolidation support earlier in September and now represents potential immediate support. Resistance is firmly established at $202-$203, challenged unsuccessfully multiple times in September, and stronger overhead resistance exists near the late August swing high of $212.49. A hammer candle near $115 on June 17, 2024, marked a major reversal point.
Moving Average Theory
TKO's price is currently trading below all key moving averages, with the 50-day MA around $198.50, the 100-day MA near $202, and the 200-day MA at approximately $175. The sequence – price < 50-day < 100-day < 200-day – confirms a persistent bearish trend structure. The 50-day MA crossed below the 200-day MA (Death Cross) in late March 2025, signaling a significant shift to a long-term downtrend which remains intact. While the 200-day MA continues its upward drift overall, the substantial distance between the current price and the rising 200-day MA ($175) highlights the severity of the recent pullback and suggests potential buyers may emerge near this longer-term trend proxy. Confluence exists as the current price approaches the psychological $195 level and previous minor support, near the descending 50-day MA.
MACD & KDJ Indicators
The MACD (12,26,9) line is below the signal line and entrenched in negative territory, with a moderately increasing histogram indicating sustained bearish momentum. There is no observable bullish divergence at recent lows. The KDJ indicator (9,3,3) shows K and D lines deeply in oversold territory (below 20), although J line remains below zero. While the K line recently attempted to curl upwards slightly, it struggles to break meaningfully above 20, suggesting persistent selling pressure. Both oscillators agree on a strongly bearish momentum structure. The current oversold reading on the KDJ and MACD's position deep in negative territory present a warning that the selling may be nearing exhaustion, increasing the probability of a technical bounce, though a decisive trend reversal signal is absent.
Bollinger Bands
Bollinger Bands (20,2) have expanded significantly during the September decline, reflecting increasing volatility and downside momentum. Price is pressing against the lower Bollinger Band ($194.60 as of the last session), which often acts as a temporary support level or signals an oversold condition. Band expansion typically follows a strong directional move; continued trading at or below the lower band warns of potential further downside, while a move back inside the bands would suggest stabilization. A narrowing band preceding the late August breakdown into September highlighted the impending volatility spike. Current band expansion confirms the established bearish move.
Volume-Price Relationship
The breakdown below the $200 support level around September 16th and 17th occurred on notably higher volume (over 1.8 million and 1.93 million shares respectively), validating the significance of this breakdown and confirming bearish intent. The subsequent decline, including the most recent 3.21% drop on above-average volume (1.37 million shares), indicates sustained selling pressure. Bullish volume spikes were observed during the powerful upswing from June to August, especially on the August 11th 10.23% surge (2.65 million shares), establishing those levels as key demand zones. Recent high volume on down days vs. generally lower volume on up days within the downtrend reinforces the bearish volume-price structure. The March 21st record volume spike coincided with the Death Cross formation, marking a major distribution point.
Relative Strength Index (RSI)
The 14-day RSI currently reads approximately 29.5, solidly below the oversold threshold of 30. This indicates the stock is technically oversold based on recent momentum. Prior instances where the RSI dipped into the low 30s (August 6th, 2025, and March 14th, 2025) were followed by at least short-term bounces, though within the context of larger established trends (bullish in August, bearish in March). While the oversold condition increases the probability of a near-term technical rebound or consolidation, the RSI itself does not signal a reversal. It highlights that the pace of the recent decline has been rapid but is not yet at extreme historical oversold levels.
Fibonacci Retracement
Applying Fibonacci retracement to the most recent clear swing high (June 21st peak at $212.49) and the subsequent swing low (September 24th close at $195.79 – using the significant low near $195 as the trough point) yields key retracement levels. The 23.6% retracement sits near $198.20, aligning closely with the psychological $200 level and the descending 50-day MA. The 38.2% retracement is found near $205, coinciding with the early September resistance zone and the 100-day MA. The 50% retracement at $209 provides a longer-term target for any significant recovery attempt. These Fibonacci levels provide clearly defined zones for potential resistance should a bounce materialize from the oversold conditions noted in other indicators, with confluence at the $198 and $205 levels.
Confluence and Divergence
Significant confluence exists around the $195 price level, representing immediate price support, proximity to the Bollinger Band lower boundary, and oversold RSI/KDJ readings. Resistance confluence is strongest near $198-$200, aligning with the 23.6% Fibonacci level and the descending 50-day MA. Notable divergence is limited; MACD and KDJ show no convincing positive divergence despite oversold conditions, suggesting any bounce from the current levels might initially be corrective rather than a definitive trend reversal. Price remains below key moving averages while momentum oscillators are bearish, presenting a coherent bearish picture. The primary divergence is between the deeply oversold short-term oscillators (RSI, KDJ) and the persistently bearish trend structure (moving averages, MACD), suggesting heightened potential for volatility but no strong reversal signal. The MACD histogram showed reduced negative momentum (divergence) on September 24th compared to the previous significant low, potentially signaling diminishing selling pressure at these levels.