Arm Holdings Rises 3.3% as Technical Analysis Signals Bullish Continuation

Arm Holdings (ARM) advanced 3.30% to close at $161.92 in the latest session, with trading volume of 5.38 million shares and a daily range between $158.19 and $164.58. This analysis examines the technical structure using multiple frameworks to assess future price probabilities.
Candlestick Theory
Recent candlestick patterns reveal constructive price action. The current session’s robust bullish candle (open near $159.90, close at $161.92) follows a Hammer formation on July 18 (low of $156.38, close at $156.74), signaling rejection of lower prices. Immediate resistance is evident near the $164.50-$165.50 zone (June 27 high of $165.46 and July 21 high of $164.58), while support converges at $156.50-$157.00, reinforced by the July 18 low and the 50-day moving average. A break above $165.50 could trigger accelerated momentum.
Moving Average Theory
The moving average configuration demonstrates a resilient uptrend. The 50-day SMA ($147.20) remains above the 100-day SMA ($135.80), which in turn exceeds the 200-day SMA ($129.50), confirming a bullish long-term sequence. Price maintains position above all key averages, with the 50-day SMA acting as dynamic support during July’s pullback. This alignment suggests sustained upward inclination, though extended deviations may invite short-term mean reversion.
MACD & KDJ Indicators
MACD (12,26,9) shows a bullish crossover above the signal line but narrowing histogram bars, hinting at moderated positive momentum. KDJ readings (K: 78, D: 75, J: 84) approach overbought territory (J > 80), though persistent values above 70 may indicate strong trend continuation rather than immediate reversal. Divergence is absent, with both oscillators aligning with recent price strength. However, KDJ’s proximity to overbought levels warrants monitoring for exhaustion signals if prices stall near resistance.
Bollinger Bands
Bollinger Bands (20-day, 2σ) exhibit expansion after a contraction phase in early July, reflecting rising volatility. Price currently rides the upper band ($162.50), typically suggesting continuation bias. The July 16 breakout candle closed above the upper band on high volume, validating the expansion’s bullish impulse. Support resides at the middle band ($154.00), coinciding with the 50-day SMA. Band expansion concurrent with price strength reinforces the uptrend’s credibility.
Volume-Price Relationship
Volume analysis confirms bullish conviction. The July 16 advance (4.62% gain) occurred on 7.45 million shares—the highest volume in three months—validating breakout authenticity. Recent rallies (July 17, 21) show above-average volume, while pullbacks manifest reduced activity, indicating limited selling pressure. The volume-weighted average price (VWAP) near $155.00 provides additional support, creating a positive volume footprint for the current trend.
Relative Strength Index (RSI)
The 14-day RSI reads 67, marginally below overbought thresholds but reflecting strengthening momentum. While not yet exceeding 70, the RSI’s upward trajectory from mid-June’s neutral reading (45) signals accumulating buying pressure. Historically, RSI peaks above 75 (observed in late June) preceded minor consolidations. Current levels suggest room for further upside, though a breach above 70 may introduce short-term corrective risks.
Fibonacci Retracement
Applying Fibonacci to the dominant uptrend from $85.82 (April 8 trough) to $165.46 (June 27 peak) reveals key levels. The recent pullback to $145.04 (June 20) held near the 23.6% retracement ($144.50), affirming trend resilience. Current price approaches the 161.8% extension level ($167.00) and confronts immediate psychological resistance at $165.50. Confluence between the 78.6% retracement ($159.00) and the July 21 low ($158.19) establishes a high-probability support zone for tactical entries.
Confluence and Divergence
Confluence is pronounced at $165.00-$165.50, where candlestick resistance, the June 27 peak, Bollinger upper band, and Fibonacci extensions converge. A decisive close above this zone would signal bullish continuation toward $170.00-$172.00. Conversely, no material divergences exist among oscillators, though RSI and KDJ near overbought territory suggest potential consolidation before further advances. Volume-supported price action and moving average alignment provide robust trend validation, outweighing short-term overbought risks. The primary technical structure favors upside resolution, with $156.50-$157.00 serving as critical support. A break below $155.00 would invalidate the immediate bullish bias.