Pure Storage Surges 32% To Record High On Breakout Momentum

Pure Storage (PSTG) surged 32.34% on the latest session, closing at $80.54, marking its second consecutive day of gains with a cumulative 37.53% increase over two sessions. This explosive move follows a period of consolidation between $55–$60, indicating a potential breakout driven by significant catalysts.
Candlestick Theory
The recent sessions reveal a Bullish Engulfing pattern: the 32.34% surge on August 28 engulfed the prior day’s 3.93% gain, signaling strong upward momentum. Resistance is now established at $80.68 (the day’s high), while support lies near $69–$70, aligning with the session low and psychological barriers. Prior to this breakout, the stock consolidated between $55–$60 for two weeks, forming a base that now serves as critical support.
Moving Average Theory
The 50-day SMA ($59.20) and 100-day SMA ($57.80) have converged above the 200-day SMA ($54.40), confirming a long-term bullish structure. The price is trading significantly above all three averages, signaling robust upward momentum. The steep ascent has created a wide gap between the price and its SMAs, suggesting potential short-term overextension.
MACD & KDJ Indicators
MACD shows a bullish crossover with rising histogram bars, reinforcing the uptrend. KDJ values (K: 85, D: 78, J: 99) are deep in overbought territory (>80), indicating extreme bullish momentum but also warning of exhaustion. While both oscillators support continued strength near-term, the KDJ’s overbought readings suggest a pullback or consolidation is increasingly probable.
Bollinger Bands
Price has surged above the upper Bollinger Band ($72), indicating extreme volatility and overbought conditions. This deviation from the 20-day average ($62) marks the most significant expansion in a year. Historically, such sharp moves outside the bands precede short-term consolidations, though the band expansion itself suggests trend continuation after a pause.
Volume-Price Relationship
Volume spiked 174% to 20.35 million shares during the 32.34% surge, validating the breakout with exceptional participation. This dwarfs the 60-day average volume of 2.6 million, signaling strong institutional conviction. The volume profile confirms sustainability, as accumulation days preceded the surge (e.g., August 22 saw 1.72 million shares on a 4.67% gain).
Relative Strength Index (RSI)
The 14-day RSI has spiked to 88, deep in overbought territory (>70). While this reflects extreme bullish momentum, it also flags exhaustion risk. Historical parallels show similar RSI peaks preceded 5–8% pullbacks within two weeks. RSI divergence is absent, however, as both price and RSI made new highs.
Fibonacci Retracement
Using the swing low of $44.76 (September 6, 2024) and high of $80.68 (August 28, 2025), key retracement levels are $68.33 (23.6%), $62.72 (38.2%), and $57.16 (50%). The current price sits above the 23.6% level, which now acts as primary support. Confluence exists here with the prior $69 resistance-turned-support and the psychological $70 level.
Confluence and Divergence
Strong confluence exists at $69–$70, where Bollinger Band support, Fibonacci 23.6%, prior resistance, and psychological barriers align. Divergence appears between price momentum and RSI/KDJ overbought extremes, suggesting near-term consolidation. However, the validated volume breakout and MACD bullishness indicate underlying strength. Short-term caution is warranted due to overextended readings, but the overall technical structure remains bullish, with pullbacks to $70–$72 offering potential entry points.