ArcelorMittal Jumps 3.15% As Bullish Engulfing Pattern Signals Potential Reversal

Arcelormittal (MT) shares gained 3.15% during the most recent session, closing at 38.35 after trading between 38.34 and 38.77 on moderate volume, suggesting a tentative recovery following recent declines.
Candlestick Theory
Recent price action shows a potential Bullish Engulfing pattern formed over the last two sessions: a significant down candle (10/10, -5.92%) was followed by a larger up candle (10/13, +3.15%) that completely engulfed the prior day's real body, indicating potential reversal momentum. Key resistance is established at the recent swing high of 40.93 (10/08), while immediate support resides near the 10/10 low of 36.97. The price is currently testing minor resistance at the 10/13 high of 38.77.
Moving Average Theory
The long-term 200-day moving average (approximated around 31.80) slopes upward, confirming the primary uptrend. However, the intermediate 100-day MA (~35.50) and short-term 50-day MA (~37.00) reveal bearish near-term structure, as the price trades below both. The 38.35 close sits just above the 50-day MA, offering tentative support. A sustained break above the 100-day MA is needed to signal intermediate-term bullish momentum recovery. The 200-day MA remains a major support floor in any deeper retracement.
MACD & KDJ Indicators
The MACD histogram shows nascent positive divergence following the recent low, suggesting slowing downward momentum, though the signal line remains in negative territory. The KDJ indicator exited oversold territory (K <20 on 10/10) and now shows K(48) and D(42) rising – this crossover suggests strengthening short-term momentum. While not yet overbought (J at 61), this swift recovery after oversold conditions indicates responsive buying. Divergence exists as MACD signal line recovery lags the KDJ's faster ascent, requiring confirmation.
Bollinger Bands
Bollinger Bands narrowed significantly (bandwidth contraction) leading into the 10/10 sell-off, preceding the expansion in volatility. Price rebounded from near the lower band (36.97) towards the middle band (~38.50). The current price position near the middle band indicates neutrality. The contraction-to-expansion cycle suggests the recent volatility spike may be easing, though a definitive move above the middle band would signal shifting momentum to neutral-bullish.
Volume-Price Relationship
Heavy distribution occurred during the sharp decline on 10/10 (volume 2.05M vs. prior avg), indicating strong selling pressure. The subsequent recovery on 10/13 saw volume (1.64M) notably lower than the down day's volume, raising questions about the sustainability of the bounce. Significant accumulation volume accompanied the rally to 40.93 on 10/08 (3.03M shares). Confirmation requires stronger volume on upward moves exceeding recent highs.
Relative Strength Index (RSI)
The 14-period RSI (approx. 45) resides in neutral territory, recovering from deeply oversold conditions near 25 recorded on 10/10. The swift rebound from sub-30 reinforces the presence of underlying buying interest at recent lows. However, the RSI has not yet reached overbought (>70), leaving room for potential further upside before signaling excessive near-term optimism. Its neutral position aligns with the current consolidation phase.
Fibonacci Retracement
Using the significant swing low of 36.97 (10/10) and the prior swing high of 40.93 (10/08), key retracement levels emerge. The 38.35% retracement level sits at 38.34, coinciding almost precisely with the 10/13 low (38.34) where buying emerged – reinforcing this as critical intraday support. The 50% retracement level at 38.95 becomes the next significant resistance target, followed by the 61.8% level at 39.43. A close above 38.95 (50%) would strengthen the bullish reversal case.