Western Digital Extends Slide With 8.67% Two-Day Drop Amid Technical Breakdown

Western Digital (WDC) closed at $119.93, declining 4.27% and extending its two-day losing streak to 8.67%. This sharp near-term correction warrants a multi-indicator technical analysis.
Candlestick Theory
Recent sessions exhibit strong bearish momentum, with the latest two candles forming long red bodies closing near lows. This confirms significant selling pressure following the rejection near the $136-$137 resistance zone. Prior support around $125 (October 6 low) failed decisively, shifting focus to the psychological $120 level and the late-September swing low near $116.74.
Moving Average Theory
The 50-day MA (approximated at $125) has been breached downward with conviction, signaling near-term trend deterioration. The 100-day MA (~$110) and 200-day MA (~$95) maintain upward slopes, suggesting the longer-term uptrend remains intact. The current price trading below the 50-day but above the 100/200-day MAs reflects a transitional phase where short-term weakness must be monitored against longer-term support.
MACD & KDJ Indicators
MACD shows a bearish crossover below the signal line, with histogram bars deepening negatively – confirming accelerating downward momentum. KDJ's K-line (20.8) and D-line (29.5) are plunging through the oversold threshold (below 30), while J-line nears zero. This signals extreme near-term bearishness, though traditional oversold conditions suggest potential for a technical rebound, absent broader market deterioration.
Bollinger Bands
Price has pierced the lower Bollinger Band ($118-$130 range), typically indicating oversold conditions. This deviation, coupled with expanding bandwidth, suggests heightened volatility favoring continued downside or consolidation. A close back inside the bands would hint at stabilization.
Volume-Price Relationship
Distribution days dominate, with the two recent down days recording significantly elevated volume (13.06M and 13.06M shares) versus the preceding rally days. This high-volume selloff confirms institutional participation in the downturn, undermining confidence in immediate recovery prospects.
Relative Strength Index (RSI)
The 14-day RSI at 31 flirts with oversold territory (<30). While this might foreshadow short-term exhaustion, its failure to generate positive divergence during the recent breakdown warrants caution. The indicator remains in a clear bearish trajectory, emphasizing momentum remains skewed downward.
Fibonacci Retracement
Using the swing low from late August 2024 (~$65) to the October 2025 high ($136.64), key retracement levels emerge: 38.2% ($109.20), 50% ($100.82), and 61.8% ($92.44). The breakdown below $125 opens a path toward the 38.2% retracement at $109.20. Confluence exists at this level with the 100-day moving average and prior consolidation zone.
Confluence & Divergence
Strong confluence exists in resistance at $125–$127 (50-day MA, psychological level, recent breakdown point). Near-term support is less defined, though $116.74 (September 29 low) and $109.20 (Fibonacci 38.2%) offer technical anchors. The most significant divergence is the KDJ nearing oversold while MACD shows unabated bearish momentum. Volume confirms bearish conviction, outweighing RSI/KDJ oversold hints for now. The breakdown below key moving averages and high-volume decline tilt probabilities towards further testing of lower supports, with any rebound needing to reconquer $125 to signal renewed strength.