United Rentals Drops 3.72% As Technical Indicators Signal Bearish Momentum

United Rentals (URI) declined 3.72% in the latest session, extending its losing streak to two consecutive days with a cumulative 4.75% drop. The stock closed at 778.02 after trading between 777.985 and 815.9 on elevated volume of 720,822 shares. This recent weakness provides context for the following multi-indicator technical assessment.
Candlestick Theory
Recent price action shows a bearish reversal pattern. The July 17th session formed a shooting star (high: 818.72, close: 816.81) near the 52-week high, followed by two consecutive red candles confirming rejection at the 815-820 resistance zone. The latest long red candle with minimal lower shadow indicates sustained selling pressure. Key support emerges at 777.98 (July 21st low), aligned with the June 30th swing low of 750.3. Resistance solidifies at 815.9, reinforced by multiple failed breakout attempts in mid-July.
Moving Average Theory
The 50-day SMA (approximately 750-760 based on manual calculation) sits below the 100-day (780-790) and 200-day (715-725), preserving the long-term uptrend. However, the current price (778.02) has breached the 100-day SMA after hovering above it since early July. A sustained break below the 50-day SMA would signal significant trend deterioration, while recovery above the 100-day SMA (790-795) is needed to restore bullish momentum.
MACD & KDJ Indicators
MACD exhibits a bearish crossover with the signal line and descending histogram bars, confirming weakening momentum. KDJ oscillators (particularly the %J line) have retreated from overbought territory (>80) in early July toward neutral levels. Neither indicator yet shows oversold conditions, suggesting room for further downside. Concurrent bearish signals from both momentum oscillators reinforce the near-term corrective bias.
Bollinger Bands
Volatility contraction preceded the recent decline, with bands narrowing significantly in mid-July as the price consolidated near the upper band. The breakdown below the 20-day moving average (centerline) and subsequent close near the lower band (estimated 760-770) signals strengthening downward momentum. Band expansion during the selloff confirms a new directional phase, with the lower band now acting as dynamic support.
Volume-Price Relationship
Distribution patterns are evident, with the two highest volume days in July (July 21: 720k shares; July 17: 805k shares) accompanying price declines. The July 21st selloff occurred on 85% higher volume than the 30-day average, validating bearish conviction. Conversely, upside volume during the July 12-15 consolidation was notably subdued, indicating lack of buyer commitment at higher levels.
Relative Strength Index (RSI)
The 14-day RSI has fallen from near-overbought levels (68-70) in mid-July to the current reading of approximately 42. While this exit from overbought territory occurred without reaching extreme readings (>70), the momentum shift is clear. The current neutral reading offers little immediate reversal signal, though a dip below 35 could trigger short-term oversold conditions based on historical reactions near the 30 threshold.
Fibonacci Retracement
Applying Fib levels to the upswing from the April 2025 low (570.6) to the July high (821.91) reveals critical thresholds. The 23.6% retracement (782) was breached decisively on July 21st. The next technical support appears at the 38.2% level (748.5), closely aligned with the psychological 750 support and June swing lows. A break below this level would open the path to the 50% retracement (720.5).
Confluence and Divergence
Significant confluence appears at 748-750, where Fibonacci support aligns with the 50-day SMA and March-June consolidation resistance-turned-support. The volume-backed breakdown below 782 and bearish MACD/KDJ convergence reinforce negative momentum. However, a notable divergence exists in the RSI, which hasn't yet reached oversold levels despite the sharp price decline – a condition that may precede short-term stabilization if other indicators confirm. The absence of bullish reversal candles at current levels suggests caution remains warranted.