Atlassian Stock Jumps 4.65% As Technical Indicators Signal Bullish Reversal

Atlassian (TEAM) shares gained 4.65% to close at $171.88 in the latest session, with trading volume reaching 2.48 million shares. This upward momentum provides context for our technical analysis of the stock's one-year price trajectory.
Candlestick Theory
The recent price action shows a bullish engulfing pattern formed by the August 26th bearish candle (close: $164.25) and August 27th strong bullish candle (close: $171.88). This signals potential reversal momentum after the August 13th low of $156.69, which established a critical support level. Immediate resistance emerges near the July 31st swing high of $199.09, while multiple tests around $165.94 (August 27th low) confirm a secondary support zone. The recovery from August lows exhibits higher lows, suggesting buyers are defending the $157-$159 support band.
Moving Average Theory
The 200-day moving average (positioned near $210) maintains a downward slope, confirming the primary bearish trend. However, the 50-day MA (approximating $180) has begun flattening, indicating potential short-term trend stabilization. A death cross persists between the 50-day and 100-day MAs, though the price rally above the 20-day EMA ($168) suggests nascent bullish momentum. Sustained trade above $175 may challenge the descending 50-day MA resistance.
MACD & KDJ Indicators
The MACD histogram has turned positive for the first time since May, with the signal line crossing bullishly near oversold territory – a potential early reversal signal. KDJ curves show the %K line (14.3) crossing above %D (11.8) from deeply oversold levels (<20), indicating gathering upward momentum. However, both oscillators remain below their midpoints, warranting caution until MACD sustains above its zero line and KDJ exceeds 50.
Bollinger Bands
The bands contracted sharply to a 13% width during August’s consolidation between $156-$169, marking the tightest squeeze in six months. The breakout above the upper band ($170) on August 27th signals renewed volatility expansion and bullish conviction. However, the close near the band’s upper limit suggests potential near-term overextension, with pullbacks likely to find support near the middle band ($167).
Volume-Price Relationship
Volume surged 45% above average during the August 12th breakdown below $158, confirming capitulation. The subsequent recovery saw lower volume (14% below average), raising sustainability concerns. However, the August 27th rally occurred on 9% above-average volume – the first significant upside volume confirmation since June. This divergence between high-volume selloffs and low-volume recoveries remains a concern, requiring continued volume expansion to validate the uptrend.
Relative Strength Index (RSI)
The 14-day RSI rebounded sharply from oversold (28.6 on August 13) to 44.2 currently. This momentum shift above 40 supports the reversal thesis but remains below the bullish threshold of 50. Weekly RSI (39.7) shows room for further recovery before overbought conditions emerge. Importantly, the August 13th price low coincided with a higher RSI low versus the June bottom, establishing a bullish divergence that preceded the current rally.
Fibonacci Retracement
Using the dominant downtrend from the February high ($325.99) to August low ($156.69), key retracement levels emerge at $196.65 (23.6%), $221.35 (38.2%) and $241.34 (50%). The recent rally stalled precisely at the 23.6% level ($172.6) of the secondary decline from July’s $220.89 high – making the $172-$175 zone critical overhead resistance. Sustained breakout above this barrier could trigger momentum buying toward $188-$190, while failure here may reinforce the primary downtrend.
Confluence occurs at the $172-$175 resistance zone, where Fibonacci levels, Bollinger Band extremes, and the descending 50-day MA converge – a pivotal test for bulls. A confirmed breakout supported by expanding volume could catalyze rapid gains toward $188, though the primary moving average alignment and negative volume divergence advise caution. Probabilistically, the confluence of reversal signals (bullish candlestick, MACD/KDJ crossovers, RSI divergence) suggests a tradable rally is developing, though sustainability beyond $175 requires fundamental catalysts to overcome the structural downtrend.