Aurora Innovation (AUR): Downtrend Intensifies Amid Bearish Volume Spike – Targeting Further Lows

Step-by-Step Technical Analysis of Aurora Innovation, Inc. (AUR)

1. Trend Analysis

• Long-term (4 months, Mar–Jun 2025): The price pattern shows AUR peaked above $8.00 in early May, then steadily trended downward. The current price ($5.17) is near recent lows, confirming a clear downtrend since May.
• Short-term: Since mid-June, the price has tested the $5.20–$5.55 range several times but failed to sustain any recovery, indicating persistent selling pressure.

2. Support and Resistance

• Support:
  • $5.15–$5.20: This zone has held on June 20, 23, 25, and 27, acting as a significant support.
  • $5.00: Psychological round level, tested in April and never broken.
• Resistance:
  • $5.40–$5.55: Several recent failed rallies in late June stalled here.
  • $5.70–$6.00: Next resistance if $5.55 is reclaimed.

3. Volume Analysis

• Observation:
  • Recent days (June 26 & 27) have seen extremely high volume (June 27: ~162M, a huge spike relative to the average of ~15–30M), combined with a sharp intraday drop and close near lows.
• Interpretation:
  • Heightened volume and a close near session lows typically indicate institutional selling/exhaustion of buyers, suggesting capitulation and possible panic selling.

4. Candlestick Patterns & Price Action

• Last 10 sessions:
  • Several small-bodied candles with long lower shadows (June 25–26), signalling attempted rebounds that failed.
  • June 27 session: large red candle (opened at $5.40, closed at $5.17, low at $5.14), on massive volume—a classic bearish engulfing/bar, suggesting sellers are in tight control and a new low could be imminent.

5. Moving Averages

• Short-term MA (5–10 days):
  • The price is firmly below short-term moving averages (approx. $5.30–$5.35), indicating bearish momentum.
• Medium/Long-term MA (20–50 days):
  • All longer-term averages would be above price ($5.70+), confirming a strong downtrend with no nearby support from moving averages.

6. Relative Strength Index (RSI)

• Price action approximation:
  • Extended and rapid recent decline, likely pushing the RSI into oversold (<30) territory. While oversold could suggest a bounce, such readings can persist during strong trends.
• Interpretation:
  • Being oversold is not a buy signal in isolation; the trend is still down until confirmed otherwise.

7. MACD (Moving Average Convergence Divergence)

• Projection:
  • MACD lines will have crossed below zero weeks ago and continue diverging negatively, underscoring bearish momentum.

8. Bollinger Bands

• Pattern:
  • Price hugging/lodged near the lower band, indicating increased volatility and downward momentum. No mean reversion evident yet.

9. Volume Profile & Distribution

• Significantly elevated volume at new lows suggests either capitulation or another leg down as weak hands are forced out.
• If capitulation, a bounce could follow, but price action shows no sign of bottoming (no reversal candles) as of June 27.

10. Fibonacci Retracements

• Drawn from May high ($8.25) to June low ($5.17):
  • Price never broke above 23.6% ($6.00) after recent drops—retracements quickly failed, confirming seller dominance.

11. Pattern Recognition

• Descending Channel:
  • Price contained within lower-high, lower-low pattern for all of June. No breakout attempted.
• Bearish Continuation:
  • No bottoming pattern (no hammer/inverse head and shoulders). Bearish continuation likely.

12. Market Psychology & Order Flow

• Spike in volume at support with no rebound is commonly a sign of forced liquidation or margin calls—often precedes further downside as the market seeks new buyers at even lower levels.

13. Summary & Outlook

• The culmination of trend direction, lack of reversal patterns, massive distribution volume, and absence of support from moving averages all point to a bearish bias for the next 24 hours.
• Even if a short-lived bounce occurs, overhead supply/resistance (especially $5.40–$5.55) will likely cap price.
• Downside risk to $5.00 or below is present, especially if panic selling resumes. Possible acceleration under $5.15 support.

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Final Strategy and Trade Plan

• Bias: Strong Sell.

• Entry: After a minor relief rally to $5.22–$5.25 (if occurs)—ideal risk/reward zone for opening a short position, as support turns to resistance.

• Targets:

  • Primary: $5.00 even (psychological, historical support—expect some buyers there).
  • If panic persists or $5.00 breaks: Watch for sharp flushes toward $4.80–$4.90 (not included in this 24hr window).

• Key Risks:

  • If a material intraday reversal develops (strong bullish engulfing candle or massive buy spike), be prepared to reassess, but for now, technicals say lower.

Conclusion:

• No evidence of a bottom. Trend is strong down. Volume supports further downside. Short rallies should be sold. Initiate a SELL (short) at $5.22, target a quick exit at $5.00 for profit capture in the next session.

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Trade Setup:

• Action: Sell (Short Position)
• Open Price (Ideal Entry): $5.22
• Take Profit (Target): $5.00

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If you have a strict risk approach, set a stop above $5.40 in case of unexpected reversal.