Yatsen (YSG) Plunges 32%: What's Behind the Sharp Selloff and What's Next?

Summary
• Yatsen Holding (YSG) tumbles 31.97% to $3.83, hitting an intraday low of $3.30 amid heavy turnover of 1.12M shares
• The stock trades 31.97% below its previous close of $5.63, with a 52-week range of $3.01–$11.57
• Bath & Body Works (BBWI) defies the bearish trend, surging 1.95% in the Specialty Retail sector
• Technical indicators signal a short-term bearish bias with RSI at 40 and MACD below zero

Yatsen’s dramatic intraday collapse has drawn urgent attention from traders and analysts. The stock’s 32% drop—its largest single-day decline since 2020—has created a stark contrast with sector peers like BBWI. With a dynamic P/E of -21.6 and a -31.97% intraday price change, the move raises critical questions about catalysts, technical triggers, and potential recovery paths.

Bearish Momentum Unleashed by Liquidity Pressure
The 31.97% intraday plunge in Yatsen’s stock price reflects a confluence of technical exhaustion and liquidity crunch. The stock opened at $5.60, nearly unchanged from its previous close of $5.63, but rapidly deteriorated as selling pressure overwhelmed buyers. By 20:29 ET, the price had collapsed to $3.83, a 31.97% drop, with the intraday low at $3.30. This sharp move aligns with the stock’s short-term bearish K-line pattern and MACD crossover below the signal line (-0.399 vs. -0.421). The -21.6 dynamic P/E ratio and -31.97% intraday change suggest a liquidity-driven selloff rather than fundamental deterioration, as no material news was reported in the provided data.

Specialty Retail Sector Diverges: BBWI Outperforms YSG
While Yatsen’s stock collapsed, sector leader Bath & Body Works (BBWI) rose 1.95%, highlighting divergent performance within the Specialty Retail sector. BBWI’s resilience underscores the sector’s mixed dynamics, with YSG’s 31.97% decline creating a stark contrast. The sector’s broader context—driven by consumer discretionary spending trends—suggests YSG’s move may reflect specific liquidity issues rather than a systemic sector-wide downturn.

Technical Divergence and Options Volatility: A Bearish Playbook
• 200-day MA: $7.12 (well above current price)
• RSI: 40.0 (oversold territory)
• MACD: -0.399 (bearish crossover)
• Bollinger Bands: Lower band at $5.11 (price at $3.83, 26% below)
• Turnover Rate: 1.83% (moderate liquidity)

The technical setup suggests a short-term bearish bias with potential for a rebound from oversold levels. Key support levels at $5.63 (30D support) and $8.88 (200D resistance) define critical thresholds. The 1.83% turnover rate indicates moderate liquidity, but the lack of leveraged ETF data limits direct sector exposure.

Top Options Picks:
• YSG20260717P2.5 (Put Option)
- Strike Price: $2.50
- Expiration: July 17, 2026
- IV Ratio: 29.71% (moderate)
- Delta: -0.0145 (low sensitivity)
- Theta: -0.000064 (slow decay)
- Gamma: 0.0408 (modest sensitivity)
- Turnover: 0 (no liquidity)
- Leverage Ratio: 785.00% (extreme)
- Payoff (5% downside): $0.33 (max(0, 3.830.95 - 2.50))
- Why it stands out: The 785% leverage ratio offers outsized potential if the bearish trend continues, but the zero turnover and low delta make execution risky.

• YSG20260717C5 (Call Option)
- Strike Price: $5.00
- Expiration: July 17, 2026
- IV Ratio: 14.52% (low)
- Delta: 0.0304 (low sensitivity)
- Theta: -0.000091 (slow decay)
- Gamma: 0.1556 (modest sensitivity)
- Turnover: 0 (no liquidity)
- Leverage Ratio: 785.00% (extreme)
- Payoff (5% downside): $0 (max(0, 3.830.95 - 5.00))
- Why it stands out: The 785% leverage ratio could amplify gains if the stock rebounds, but the zero turnover and low delta make it a speculative bet.

Trading Outlook: Aggressive bears may consider the YSG20260717P2.5 put option if the stock breaks below $3.30, while cautious bulls might target a rebound above $5.63. However, the lack of liquidity in both contracts necessitates extreme caution.

Backtest Yatsen Stock Performance
The backtest of YSG's performance after a -32% intraday plunge from 2022 to now shows mixed results. The 3-Day win rate is 48.23%, the 10-Day win rate is 49.56%, and the 30-Day win rate is 48.45%. The maximum return during the backtest was 8.88% over 30 days, with a maximum return day on December 11, 2025.

Critical Levels and Sector Divergence: Immediate Action Required
Yatsen’s 31.97% intraday plunge has created a high-risk, high-reward scenario. The stock’s technical indicators—oversold RSI, bearish MACD, and 26% discount to the Bollinger lower band—suggest a potential rebound, but the lack of liquidity in options and the absence of leveraged ETFs complicate positioning. Sector leader BBWI’s 1.95% gain highlights the divergence within the Specialty Retail space, indicating YSG’s move may be idiosyncratic. Traders should monitor the $5.63 support level and BBWI’s performance as key signals. Act now: Short-term bears may target the YSG20260717P2.5 put option if the $3.30 intraday low is retested, while bulls should watch for a break above $5.63 to confirm a reversal.