Warner Bros Discovery Jumps 4.57% To Extend 7-Day Rally As Technicals Flash Bullish Signals

Warner Bros Discovery (WBD) closed at $12.58, rising 4.57% for its seventh consecutive daily gain, with a 14.16% advance over this bullish week. This momentum provides context for the following technical assessment.
Candlestick Theory
Recent price action reveals a robust bullish sequence, characterized by seven consecutive white candles with progressively higher closes. The latest session (2025-07-16) formed a long-bodied bullish candle (low: $12.035, high: $12.65), closing near its peak at $12.58. This signals strong buying pressure, with immediate resistance established at $12.65. Support is visible near $11.65 (swing low on 2025-07-10), followed by a stronger floor at $11.00–$11.04 (clustering of June–July troughs). The absence of reversal patterns like dojis or hammers suggests persistent upward momentum.
Moving Average Theory
The 50-day MA ($10.80) sits above the 100-day MA ($9.95) and 200-day MA ($9.30), confirming a long-term bullish trend. The current price ($12.58) trades well above all three averages, reinforcing strength. A bullish golden cross occurred in late June when the 50-day crossed above the 100-day, signaling accelerated upside potential. Pullbacks toward the 50-day MA may present buying opportunities given the established uptrend.
MACD & KDJ Indicators
The MACD line (12/26-day EMA) shows sustained positive momentum, holding above its signal line throughout July’s rally, corroborating bullish sentiment. The KDJ oscillator, however, enters overbought territory with the %K (91) and %D (88) above 80, suggesting short-term exhaustion risk. While MACD supports continuation, KDJ divergence warrants monitoring for potential consolidation—though no bearish crossover is yet evident.
Bollinger Bands
Bands expanded sharply during the 7-day rally, reflecting rising volatility and strong directional conviction. Price consistently hugs the upper band ($12.45), typically indicative of an overextended move. The 20-day SMA ($11.35) slopes upward, acting as dynamic support. Contraction from current levels may precede a consolidation phase, but band expansion persists for now, favoring bulls.
Volume-Price Relationship
Volume surged to 105M shares on 2025-07-16—the highest since early April—validating the breakout above $12.50. This volume spike coincides with the strongest daily gain in the 7-day rally, confirming institutional participation. Accumulation patterns emerged during the June base-building phase (volume rising on up days), providing a foundation for the current advance. Declining volume on minor pullbacks (e.g., 2025-07-07) underscores limited selling pressure.
Relative Strength Index (RSI)
The 14-day RSI reads 78, firmly in overbought territory (>70). This aligns with KDJ’s warning and the seventh consecutive up day, implying heightened correction probability. However, RSI can remain elevated in strong trends—historical instances (e.g., April 2025 rally) saw RSI hold above 70 for multiple sessions before moderate pullbacks. Traders should watch for bearish divergence on shorter timeframes.
Fibonacci Retracement
Using the swing low of $6.64 (2024-08-13) and the recent high of $12.65 (2025-07-16), key retracement levels are $10.28 (23.6%), $9.64 (38.2%), $9.15 (50%), and $8.61 (61.8%). Confluence exists near $10.30–$10.50, where the 23.6% retracement converges with the 50-day MA and prior resistance-turned-support (June highs). This zone offers a high-probability entry should profit-taking emerge.
Confluence and Divergence
Confluence is observed between volume-supported price action, moving averages, and MACD, collectively endorsing the dominant uptrend. However, RSI and KDJ diverge through overbought signals, suggesting near-term vulnerability. Fibonacci support at $10.28–$10.50 remains critical, as breach below may trigger deeper correction toward the 38.2% level ($9.64), where the 100-day MA resides. Overall, the technical structure favors continued strength post-consolidation.