Honda Motor Shares Surge 13.12% as Technical Indicators Signal Strong Bullish Momentum

Honda Motor (HMC) shares surged 13.12% in the latest session, extending gains to a three-day cumulative rise of 14.67%. This analysis examines the technical posture using multiple frameworks.
Candlestick Theory
The 13.12% surge formed a robust bullish marubozu candle with minimal wicks, indicating unwavering buying pressure. This pattern completes a three-white-soldier formation emerging near the $30.00 psychological support (tested July 18). Resistance now consolidates at the $34.51 yearly high. A break above $34.51 with conviction may signal continuation, while failure could see retreat to $32.50 intermediate support.
Moving Average Theory
The current price ($34.40) resides decisively above all key moving averages: 50-DMA ($30.85), 100-DMA ($30.10), and 200-DMA ($29.60). The 50-DMA recently executed a golden cross above the 200-DMA, confirming long-term trend reversal. This alignment suggests sustained bullish momentum, with pullbacks likely finding support near the 50-DMA confluence zone.
MACD & KDJ Indicators
MACD (12,26,9) shows accelerating bullish momentum as the histogram extends above the signal line. KDJ's %K (87) and %D (82) have entered overbought territory, though sustained readings above 80 reflect exceptional strength. While this dual confirmation supports trend continuation, narrowing MACD histogram bars in subsequent sessions could warn of deceleration.
Bollinger Bands
Price vaulted above the upper Bollinger Band (20,2) during the 13.12% breakout, triggering a volatility expansion signal. The 15% band width increase confirms strong directional conviction. Historically, such deviations precede consolidation, making $34.50–$35.00 a probable congestion zone. Mean reversion targets converge near $33.20 (middle band).
Volume-Price Relationship
The rally’s volume profile demonstrates validation: latest session volume (3.76M shares) tripled the 50-day average, with buying pressure particularly concentrated during upside breaks. Down days consistently showed lower volume (e.g., July 18 decline on 608K shares), indicating weak conviction in pullbacks—a hallmark of healthy uptrends.
Relative Strength Index (RSI)
14-day RSI spikes at 89.2—deeply overbought and nearing historic extremes. While such readings often precede pullbacks, context matters: similar RSI peaks in June 2025 resolved through sideways consolidation rather than sharp declines. Traders should monitor for bearish divergence upon any new highs.
Fibonacci Retracement
Applying Fib levels between the March 2025 low ($24.56) and July 2025 high ($34.51) reveals key supports: 23.6% ($32.25) aligns with the July breakout point, while 38.2% ($30.75) converges with the 50-DMA. These zones offer high-probability bounce areas should profit-taking emerge.
Confluence and Divergence Observations
Bullish confluence appears strongest near $30.75–$31.00, where 38.2% Fib, 50-DMA, and volume-weighted support converge—making it a critical defensive zone. The primary divergence concerns RSI extremity versus moderating MACD momentum, suggesting near-term exhaustion risks. However, volume validation and moving average alignment outweigh this caution currently. Traders should note that a close below $32.25 (23.6% Fib) would invalidate the immediate bullish structure.