Western Digital Stock Surges 10.16% To $78.80 On Bullish Technical Breakout

Candlestick Theory
Western Digital's recent candlestick formation demonstrates strong bullish momentum, highlighted by a 10.16% surge on July 31, 2025, which formed a decisive breakout candle above the $73 resistance level. This follows a consolidation phase between $66.50 and $70.00 in mid-July. The four consecutive up days (July 28–31) exhibit consistent buying pressure, with the July 31 session printing a long-bodied green candle (low: $73.25, high: $78.80). Key support now rests at $73.25 (July 31 low), while resistance is established at the swing high of $78.80. A close above this level may trigger further upside toward the $80 psychological barrier.
Moving Average Theory
The moving average configuration signals a robust bullish trend. The 50-day MA (approximating $65.20) recently crossed above the 100-day MA (~$60.50) and 200-day MA (~$55.80), forming a "golden cross" pattern in late June. Current price ($78.69) trades well above all three MAs, with the 50-day acting as dynamic support during the July advance. The ascending slope of the 50/100/200-day MAs confirms a strengthening intermediate-term uptrend, though the significant deviation from the 50-day MA (~18% above) suggests potential near-term consolidation.
MACD & KDJ Indicators
The MACD (12,26,9) shows sustained bullish momentum, with the MACD line (1.75) above the signal line (1.20) and a widening histogram. This aligns with the price breakout. The KDJ oscillator (9,3,3) is overbought, with K (88) and D (85) above 80, reflecting extreme near-term momentum. While both indicators concur on bullish sentiment, the KDJ's overbought reading diverges from MACD’s steadier trend confirmation, flagging short-term exhaustion risks amid the vertical price ascent.
Bollinger Bands
Bollinger Bands (20-day SMA, 2σ) expanded sharply on July 31 (bandwidth increase of ~25% vs. prior week), signaling elevated volatility. The close above the upper band ($76.80) indicates extreme bullish momentum, though historically such deviations often precede brief pullbacks. Prior to the breakout, bands narrowed significantly in late July (volatility contraction), compressing price action between $68–$71, which resolved upward on expanding volume. This supports the breakout's validity, but the current upper band violation warrants monitoring for mean reversion.
Volume-Price Relationship
The breakout was validated by a surge in volume, with July 31 trading 24 million shares—nearly double the 10-day average. Volume expansion accompanied each up day during the 14.34% four-day rally, confirming accumulation. Notably, pullbacks like the July 24–25 decline occurred on progressively lower volume, signaling limited selling pressure. The volume-weighted average price (VWAP) for July is ~$69.50, now acting as support, reinforcing the sustainability of the uptrend.
Relative Strength Index (RSI)
The 14-day RSI reads 82, deep in overbought territory (>70). This warns of short-term exhaustion, particularly after the rapid ascent. Historically, similar RSI peaks coincided with brief consolidations (e.g., February 2025 pullback after RSI >80). However, in strong trending markets, RSI can remain elevated for extended periods. Traders should view this as a cautionary signal but note the absence of bearish divergence, as the RSI continues to make higher highs alongside price.
Fibonacci Retracement
Applying Fibonacci to the April–July uptrend (swing low: $41.83 on April 30; swing high: $78.80), key retracement levels are $70.06 (23.6%), $64.67 (38.2%), and $60.31 (50%). The July 31 close above the 23.6% retracement ($70.06) confirms resilience. Confluence exists here with the psychological $70 support and the 50-day MA (~$65.20), creating a high-probability demand zone. A sustained hold above $70 would favor continued trend strength toward the 0% extension level (~$86).
Confluence and Divergence
Confluence is observed across indicators:
- Moving averages, volume, and MACD alignment support a bullish trend.
- Fibonacci 23.6% level ($70.06) coincides with prior resistance (July 30 high) and VWAP support.
Divergence exists between momentum oscillators (overbought KDJ/RSI) and trend indicators (MACD/moving averages), suggesting potential near-term consolidation before further upside. This requires monitoring for either volatility contraction or a volume-backed resolution higher to confirm trend continuation.