Carvana (CVNA) Surges 13.34% in Two-Day Rally as Bullish Patterns and Moving Averages Signal Sustained Momentum

Carvana (CVNA) has surged 6.14% in the most recent session, marking a two-day rally of 13.34%. This sharp price action warrants a technical evaluation to assess the sustainability of the momentum and potential reversal signals.
Candlestick Theory
The recent two-day bullish pattern suggests a potential breakout from a consolidation phase. Key support levels are identified at prior lows such as $309.88 and $313.25, while resistance appears at $330.90 and $335.89. A bullish engulfing pattern on the 2025-11-24 session (6.78% gain) and a hammer formation on 2025-11-25 (6.14% gain) indicate strong buying pressure. However, the absence of a clear bearish reversal pattern suggests the uptrend may persist unless the price tests and fails at critical resistance levels.
Moving Average Theory
Short-term momentum aligns with the 50-day moving average (approximately $325–$330), which is above the 200-day MA ($310–$315), confirming an intermediate bullish bias. The 100-day MA ($320–$325) acts as a dynamic support. The price currently sits above all three moving averages, suggesting a continuation of the upward trend. A breakdown below the 50-day MA would signal a potential correction.
MACD & KDJ Indicators
The MACD histogram has turned positive, with the line crossing above the signal line, reinforcing bullish momentum. The KDJ (Stochastic) oscillator shows overbought conditions (K=85, D=75), indicating a possible pullback. However, the absence of bearish divergence between price and momentum indicators (e.g., higher highs in both price and KDJ) suggests the uptrend may persist.
Bollinger Bands
Volatility has expanded as the price approaches the upper band, reflecting heightened buying activity. The 20-period Bollinger Bands show a width of ~$35, indicating elevated volatility. A retest of the lower band ($309–$313) could trigger a rebound if volume remains strong.
Volume-Price Relationship
Trading volume has surged on the recent rally, with the 2025-11-24 and 2025-11-25 sessions recording volumes of 4.28M and 2.98M shares, respectively. This confirms conviction in the upward move. However, a decline in volume during subsequent pullbacks would signal weakening momentum.
Relative Strength Index (RSI)
The RSI is currently above 70, confirming overbought conditions. While this warns of potential near-term exhaustion, the lack of bearish divergence (price and RSI both rising) suggests the trend may continue. A drop below 50 would indicate a shift in sentiment.
Fibonacci Retracement
Drawing retracement levels from the recent low ($285.025 on 2025-11-07) to the high ($351.45 on 2025-11-25) identifies key levels: 38.2% at $323, 50% at $318, and 61.8% at $313. A breakdown below $313 could trigger a test of the 78.6% level ($309).
Confluence and Divergences
The alignment of bullish moving averages, strong volume, and overbought RSI suggests a continuation of the trend despite elevated levels. However, the overbought RSI and expanding Bollinger Bands imply a high probability of a short-term correction. A break above $351.45 would target $358–$362, while a failure to hold $313.25 could lead to a retest of $303.99.
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