Charter Communications Jumps 3.86% As Technicals Signal Potential Trend Reversal

Charter Communications (CHTR) concluded the latest trading session at $280.01, posting a significant gain of 3.86% on increased volume. This advance appears to halt a recent corrective phase, potentially signaling a reversal attempt within the context of a broader, longer-term downtrend. A comprehensive technical assessment follows below.
Candlestick Theory
Recent candlestick patterns exhibit signs of potential bullish reversal following the sharp July decline. The formation of long lower wicks on October 2nd and 3rd, coupled with the latter session's strong white body closing near its high ($280.01 vs. high of $281.27), suggests rejection of lower prices and accumulation near $270.31 – a level now functioning as immediate support. Significant resistance is observed between $285-290, reinforced by multiple failed attempts to breach this zone in late September and early October. A definitive breakout above $290 would signal renewed bullish momentum.
Moving Average Theory
The moving average configuration reflects bearish structural damage. The current price ($280.01) is trading below the 100-day (approximately $305) and 200-day (approximately $320) averages, confirming the persistent longer-term downtrend. However, a tentative near-term positive exists as the price reclaimed the 50-day moving average (approximately $275) on October 3rd. A sustained hold above this average suggests a short-term uptrend could be developing, though it remains challenged by the dominant longer-term moving averages overhead. This creates potential resistance confluence near the descending 100-day average.
MACD & KDJ Indicators
The Moving Average Convergence Divergence (MACD) histogram has turned positive on the daily timeframe, reflecting growing short-term bullish momentum. While the MACD line remains below the signal line, the histogram shift is the first sign of potential momentum improvement after a period of sustained weakness. Concurrently, the KDJ oscillator shows the %K line crossing above the %D line from oversold territory (below 30) in late September. This crossover occurred while price made lower lows, creating a bullish divergence that preceded the October rally. Currently, KDJ values (around 55-60) are rising towards neutral, supporting the near-term bullish momentum thesis. However, both indicators are not yet fully in bullish territory, warranting caution.
Bollinger Bands
Price volatility, as measured by the Bollinger Bands®, contracted significantly throughout September, culminating in a tight squeeze near the $270 level. This contraction often precedes a volatility expansion. The recent price surge on October 3rd caused prices to break upwards from the lower band and move towards the midline (20-period SMA). The break above the midline could target the upper band (currently near $310), though the $285-290 resistance zone will likely prove challenging first. A sustained hold above the midline would reinforce short-term bullish momentum.
Volume-Price Relationship
Volume analysis adds credibility to the recent price action. The key downside capitulation occurred on July 25th (-18.49%) on massive, record volume (9.6 million shares), likely marking a significant exhaustion low. Subsequent bounces have generally been confirmed by above-average volume, including the October 3rd gain. This recent surge also saw volume significantly higher than the prior down day (October 2nd), suggesting stronger conviction behind the buying. Volume consistently diminishes during pullbacks like the one observed from late September to early October, indicating reduced selling pressure.
Relative Strength Index (RSI)
Based on the 14-day calculation using the RSI formula, Charter's RSI is currently around 59. This places it in neutral territory, climbing steadily after finding support near the oversold threshold (30) in late September. It peaked near 70 during the failed September 30th rally towards $285. The current reading suggests room for further potential upward movement before reaching technically overbought conditions (>70). The recent rise from oversold levels supports the view of strengthening momentum.
Fibonacci Retracement
Applying Fibonacci retracement to the dominant downward swing from the March 2025 high (~$430) to the July 2025 low ($309.75) reveals key levels. The initial significant resistance cluster aligns with the 23.6% retracement level near $285 and the psychologically important $290 area observed in the candlestick analysis. Beyond this, the 38.2% retracement sits near $325. The recent failure at the $285-$290 zone confirms its significance as derived from this classic theory. A decisive break above this confluence zone would target the next Fib level near $325.
Confluence & Divergence Summary
Strong technical confluence exists around the $270 support level, validated by multiple indicators: significant candlestick reaction (long lower wicks), the Bollinger Band lower boundary during the squeeze, and acting as a pivot point identified through recent price action. The $285-$290 resistance zone also exhibits significant confluence, combining technical significance from candlestick theory, Fibonacci retracement, previous horizontal price action, and the descending longer-term moving averages. A notable bullish divergence occurred in late September where price made lower lows while the KDJ indicator formed higher lows from the oversold region, preceding the current bounce. However, a significant divergence persists between the improving short-term indicators (MACD histogram, KDJ cross, RSI rise, short-term MA break) and the still-declining longer-term moving averages, reflecting the ongoing conflict between near-term recovery potential and the established long-term downtrend. Continued price development beyond the $270-$290 range is critical to determine the next directional phase for Charter.