HP Stock Jumps 4.57% to $28.35 on Strong Volume and Technical Breakout

HP (HPQ) posted a 4.57% gain in the most recent session, closing at $28.35 after trading between $27.00 and $28.92. This marks its second consecutive day of gains, bringing the two-day advance to 4.96% on elevated volume of 20.1 million shares, notably exceeding the recent average and signaling strong buying interest. The following technical analysis examines this move within the context of multiple indicators, highlighting key levels and potential forward signals.
Candlestick Theory
The latest candle displays a long bullish body closing near its high, following a hammer formation two sessions prior. This pattern suggests accumulation and potential continuation of the uptrend. Key support is established at $26.30 (August 21 low), with secondary support at $24.45–$24.11 (June-August swing lows). Resistance emerges near $28.92 (today’s high), with a major barrier at the $29.30–$29.50 zone (May highs). A decisive close above $29.00 may signal further upside.
Moving Average Theory
The 50-day EMA ($26.85), 100-day EMA ($26.50), and 200-day EMA ($26.70) now all slope upward, with the price trading above each, reflecting bullish alignment. Notably, the 50-day EMA recently crossed above the 200-day EMA, confirming a "golden cross" and reinforcing long-term bullish sentiment. However, the 100-day EMA remains marginally below the 200-day EMA, warranting monitoring for a full bullish confirmation across all timeframes.
MACD & KDJ Indicators
The MACD histogram has turned positive and continues to expand, with the MACD line crossing above its signal line last week. This momentum shift supports the breakout. KDJ readings show %K (78) and %D (73) overbought territory, while the J-line (88) signals stretched conditions. Though this suggests near-term exhaustion risk, the MACD-KDJ alignment still favors upward momentum, provided no bearish divergence emerges.
Bollinger Bands
Price action has pierced the upper Bollinger Band ($28.60), coinciding with a band expansion. This typically signals strong directional momentum but also indicates overbought conditions. Volatility has increased, as evidenced by the bandwidth expansion from 8% to 12%. A consolidation or pullback toward the 20-day midline ($27.00) may occur, which would realign price within the bands without damaging the uptrend.
Volume-Price Relationship
The breakout was validated by a 70% surge in volume versus the 30-day average, the highest since June. This volume spike on consecutive up days confirms institutional participation. The volume/price correlation remains positive, with no bearish divergence. Sustained trade above 15 million shares on advances would reinforce the trend’s strength.
Relative Strength Index (RSI)
The 14-day RSI (72) has entered overbought territory but shows no divergence relative to price. Elevated RSI readings during strong trends often persist; thus, this serves as a cautionary signal rather than an immediate reversal indicator. A drop below 70 without significant price deterioration would reset conditions, whereas a push toward 80 may precede a pullback.
Fibonacci Retracement
Applying Fib levels to the swing low of $21.21 (April 9) and high of $28.92 (current), the 23.6% retracement level ($27.10) held as support during the August consolidation. Confluence exists here, as $27.10 aligns with the 50-day EMA. The next significant Fib support is the 38.2% level ($25.97). The current rally’s ability to surpass the 23.6% threshold suggests room toward the 0% extension ($28.92), though profit-taking near this high is likely.
Confluence and Divergence
Confluence is notable: the golden cross, MACD bullish crossover, and high-volume breakout collectively validate the uptrend. Additionally, Fibonacci support at $27.10 aligns with moving averages, creating a robust floor. No major divergences are present, though Bollinger Band penetration and overbought KDJ/RSI readings advise against immediate new long positions. Overall, momentum favors continued upside if key supports hold, with a close above $29.00 potentially accelerating gains toward the $30.00 psychological barrier.