EOG Resources Jumps 3.11% to $117.88 Amid 4-Day 6.42% Rally as Technicals Flash Overbought Signals

EOG Resources (EOG) rose 3.11% to $117.88 in the latest session, marking its fourth consecutive gain with a 6.42% advance over this period. The recovery from the June 4 low of $110.77 signals renewed bullish momentum, though technical indicators suggest potential overbought conditions that warrant monitoring.
Candlestick Theory
Recent candlesticks reveal a bullish reversal pattern emerging from the $110.77 support (June 4 low), with three white soldiers formation consolidating near the $119.52 resistance (June 10 high). The consecutive higher closes on increasing volume validate buyer commitment, though the rejection near $119.52 underscores this zone as immediate resistance. Key support is established at $115.28 (June 9 low), with a breach below potentially targeting $113.18.
Moving Average Theory
The 50-day SMA (~$114) crossed above the 100-day SMA (~$112) in May, confirming a bullish medium-term bias. With the price currently above all three moving averages (50/100/200-day), the ascending alignment signals sustained upward momentum. The 200-day SMA near $108 offers a crucial long-term support floor, while the price-SMA convergence at $114-$115 provides a near-term confluence zone.
MACD & KDJ Indicators
MACD shows a bullish crossover above the signal line, with histogram bars expanding positively since June 6 – confirming accelerating upward momentum. KDJ readings (K: 85, D: 78, J: 92) reflect overbought territory, with the %J line nearing 100 suggesting exhaustion risk. While both oscillators agree on near-term strength, the KDJ’s extreme levels warn of potential consolidation, contrasting with MACD’s unbroken bullish trajectory.
Bollinger Bands
Bands expanded sharply during the June 10 rally (20-day SMA at $114.50, upper band at $119.30), indicating volatility surge. Price closed near the upper band, typically a signal of overextension. The previous band contraction in late May preceded this breakout. A reversion toward the midline ($114.50) appears probable to alleviate overbought conditions, though a sustained upper-band tag above $119 would signal exceptional strength.
Volume-Price Relationship
Volume surged 36% to 4.95 million shares during the June 10 rally, validating bullish conviction. The four-day advance occurred on ascending volume, supporting trend sustainability. Notably, the June 4 sell-off saw elevated volume (3.33 million shares), establishing $110-$111 as a high-volume support zone that must hold to maintain upward momentum.
Relative Strength Index (RSI)
The 14-day RSI (71) entered overbought territory, reaching its highest level since April. While confirming short-term bullish strength, this divergence from mid-May’s neutral reading (55) suggests increasing vulnerability to profit-taking. Historical reactions near RSI 70 (April and March) resulted in 5-8% pullbacks, warranting caution despite the breakout.
Fibonacci Retracement
The primary swing low ($104.96 on April 8) to swing high ($119.89 on April 3) yields key retracement levels: 61.8% ($114.18), 50% ($112.43), and 38.2% ($110.67). The recent consolidation near the 61.8% level and subsequent breakout signal bullish resolve. A sustained hold above $114.18 now transforms this Fibonacci barrier into support, opening a path toward the 78.6% retracement at $117.90 – a level virtually tested on June 10.
Confluence points emerge at $114-$115, where the 61.8% Fibonacci level, 50-day SMA, and Bollinger midline converge – making this a critical support zone. Bearish divergences include RSI overbought signals conflicting with MACD’s continued bullish momentum, while the Bollinger upper band tag and KDJ extremes suggest near-term exhaustion. The overarching technical structure remains bullish, though overextended conditions indicate a pullback toward $114-$115 may offer healthier entry points before challenging the $119-$120 resistance.