Affirm Rises 5.1% in Two-Day 9.05% Rally Amid Mixed Technical Signals

Affirm Holdings (AFRM) advanced 5.10% to $89.66 on September 4, 2025, marking its second consecutive gain and bringing its two-day rally to 9.05%. This recovery follows a sharp selloff on September 2 (-7.05%) but has yet to reclaim the August 29 peak of $100.
Candlestick Theory
The August 29 session formed a prominent bullish marubozu (open $86.76, close $88.46, high $100), establishing $100 as a major resistance level. The subsequent September 2 plunge created a long red candle closing near lows ($82.22), signaling strong selling pressure. The current rebound features a two-day bull run with the September 4 candle closing near session highs ($89.66 vs. high $91.34), suggesting renewed demand. Key support holds at $82.22 (September 2 low), with resistance tightening between $91.34 (September 4 high) and $100.
Moving Average Theory
AFRM trades decisively above primary moving averages, closing at $89.66 versus the 50-DMA (~$72.30), 100-DMA (~$65.80), and 200-DMA (~$58.40). This configuration signals a sustained uptrend. The 50-DMA has provided dynamic support since mid-July, notably during the August 22 rebound. However, the expanding gap between price and the 50-DMA (~24% premium) indicates potential overextension, increasing vulnerability to mean-reversion pullbacks.
MACD & KDJ Indicators
The MACD (12,26,9) remains positive but shows momentum erosion. While the August 29 breakout generated a bullish crossover, the histogram has flattened since September 2, indicating fading upside momentum. Meanwhile, the KDJ (9,3,3) oscillators retreated from overbought territory (K-value >90 on August 29) to neutral levels (K: 65, D: 60 as of September 4). The September 3 crossover of K above D suggests short-term bullish momentum, though divergence with MACD warns of conflicting signals.
Bollinger Bands
A pronounced volatility expansion occurred on August 29 as price spiked to the +2σ band ($96.50) before closing near the upper band. Since then, the bands have contracted moderately (20-day bandwidth narrowed 15%), reflecting declining volatility. The September 4 close near the upper band ($91.20) implies relative strength, but such proximity historically preceded consolidations (e.g., mid-July and early August).
Volume-Price Relationship
Volume patterns reveal concerning divergences. The August 29 rally to $100 occurred on towering volume (43.2M shares), confirming buyer conviction. However, the recent two-day bounce materialized on below-average volume (9.3M and 14.0M shares vs. 30-day avg ~10.5M). This low-volume rebound amid a critical resistance zone questions the rally’s durability and increases vulnerability to profit-taking.
Relative Strength Index (RSI)
The 14-day RSI cooled to 55 (calculated using 14-day gain/loss averages) after nearly entering overbought territory (78) on August 29. Current neutral positioning allows room for upside, but the rapid descent from overbought conditions parallels late June and early August pullbacks. Traders should note that RSI diverged bearishly in late August (higher high vs. lower high in RSI), frequently a precursor to corrections.
Fibonacci Retracement
Applying Fib levels to the recent decline (August 29 high: $100 → September 2 low: $81.60) shows AFRM surpassing the 38.2% retracement ($88.69) and testing the 50% level ($90.80). Confluence exists here as the September 4 high ($91.34) aligns precisely with this 50% retracement. A decisive close above $90.80 could trigger momentum toward the 61.8% level ($92.96). Failure here may see retest of the 38.2% support.
Confluence and Divergence Observations
Confluence emerges near $90.80-91.34, where Fibonacci resistance, Bollinger Band upper boundary, and recent price highs converge. Conversely, notable divergences exist: Volume fails to confirm the rebound, while bearish momentum divergences in MACD/RSI contrast with short-term KDJ positivity. These mixed signals suggest AFRM may require consolidation below $91.34 before establishing directional conviction. Key support zones for downside scenarios include the 50-DMA (~$72.30) and the volume-backed breakout level of $67.50 (early August base).