Lam Research Stock Surges 25.63% in 11-Day Rally as Technicals Signal Strong Bullish Momentum

Lam Research (LRCX) concluded the latest session at $121.9, marking an impressive 11-day consecutive gain of 25.63%, reflecting strong bullish momentum.
Candlestick Theory
Recent price action displays a consistent sequence of bullish candles, culminating in the latest session closing near its high. Key resistance is evident near $123.28 (recent high), with support established around $118.67. The absence of reversal patterns like Dojis or Bearish Engulfing suggests prevailing buying pressure, though proximity to resistance warrants caution for potential consolidation.
Moving Average Theory
The 50-day MA crossed decisively above the 100-day and 200-day MAs, confirming a bullish long-term trend. The current price ($121.9) trades firmly above all three key MAs, signaling robust upward momentum. The 50-day MA acts as dynamic support during minor pullbacks, reflecting a strong short-term uptrend supported by the golden cross configuration.
MACD & KDJ Indicators
The MACD histogram remains above its signal line with expanding positive bars, indicating accelerating bullish momentum without divergence. Concurrently, the KDJ shows the %K and %D lines persistently elevated in overbought territory (>80) but not yet crossing downward, supporting the uptrend. Both oscillators align in signaling sustained bullish energy, though overbought KDJ suggests near-term exhaustion risk.
Bollinger Bands
Price has consistently tested the upper Bollinger Band during the rally, signifying strong upward thrust. Bandwidth expansion from mid-August indicates increasing volatility, characteristic of trending phases. The absence of price contraction currently diminishes reversal signal reliability, but tight adherence to the upper band heightens the probability of a minor pullback or consolidation for breath.
Volume-Price Relationship
The initial surge (e.g., Sept 11: +7.66% on ~20.3M shares) saw significantly above-average volume, validating breakout conviction. However, volume has moderated during subsequent gains, showing less vigorous participation near current highs. While not overtly bearish, diminishing volume on new highs suggests caution; sustainability requires renewed volume confirmation on decisive breaks above $123.
Relative Strength Index (RSI)
Using a 14-period calculation, RSI currently registers near 75, placing it in overbought territory (>70). This warns of potential near-term exhaustion or pullback risk. However, RSI can remain elevated in strong trends; divergence – where price makes higher highs but RSI fails to – has not materialized, reducing immediate reversal likelihood. Monitoring for RSI divergence is crucial now.
Fibonacci Retracement
Applying Fibonacci to the swing low from June 20 ($90.49) and the Sept 17 high ($123.28) yields key levels: 23.6% ($116.28), 38.2% ($112.09), and 61.8% ($105.12). Recent pullbacks have respected the 23.6% level as support, confirming its significance. Resistance now converges with the psychological $123 level. A sustained break above $123 opens the path toward the 127.2% extension ($134), while failure risks a retest of $116.28 support.
Confluence & Divergence
Significant confluence exists: Moving averages confirm a bullish trend, MACD/KDJ concur on strong momentum, and price holds above Fibonacci support ($116.28). Bollinger Bands and candlesticks reinforce the uptrend. The primary divergence involves the elevated RSI and moderating volume, hinting at potential consolidation without overt reversal signals. This suggests Lam Research may test resistance near $123 before deciding its next directional move, with probabilities favouring continuation after a brief pause.