Cloudflare Stock Rises 3.57% To $198.42 As Technical Indicators Signal Bullish Momentum

Cloudflare (NET) rose 3.57% in the latest session to $198.42, extending its winning streak to two consecutive days with a cumulative 4.90% gain. This analysis employs multiple technical frameworks to assess the stock's current positioning and future trajectory.
Candlestick Theory
Recent price action shows a notable reversal pattern. The session ending July 23rd formed a near-piercing line at $189.15 after a significant $197.76–$190.55 sell-off, followed by two consecutive bullish candles that reclaimed over 75% of the prior decline. The current close at $198.42, near the session high of $200.01, signals strong buying interest. Key resistance is established at the all-time high of $200.77 (July 21), while support consolidates at $190.00–$191.58 (July 22–24 lows), with stronger foundational support at $186.08 (July 23 low).
Moving Average Theory
The 50-day, 100-day, and 200-day moving averages exhibit bullish alignment, with the 50-day ($184.15 approximate) sustaining above both longer-term averages. Current price trades well above all three – particularly the 200-day MA near $142 – confirming the primary uptrend. The 50-day MA provided dynamic support during the July 22–23 pullback, and the price's rebound from this level suggests persistent institutional accumulation.
MACD & KDJ Indicators
The MACD histogram shows diminishing bearish momentum as the fast line begins converging toward a potential bullish crossover. KDJ metrics oscillate near overbought territory (K-line: 84, D-line: 68) after the two-day surge but lack exhaustion signals. Notably, a bullish divergence preceded the recovery: While price bottomed at $186.08 on July 23, the KDJ oscillator formed a higher low, signaling strengthening momentum before the rebound. Short-term consolidation is probable, but no confirmed reversal pattern exists.
Bollinger Bands
Volatility expanded sharply during the July 21–22 sell-off (bandwidth increased 15%), with prices touching the lower band on July 23. The subsequent rally pushed prices into the upper band ($200 ± 1.5%), indicating overextended near-term conditions. The 20-day average (mid-band) at $191.50 now acts as support. Current band expansion suggests ongoing directional conviction, though a reversion toward the mean may precede further upside.
Volume-Price Relationship
Volume patterns validate the recovery: The July 22 sell-off occurred on elevated volume (3.96M shares), signaling capitulation, while the subsequent rebound days showed progressively higher volume (2.62M → 2.70M). This ascending volume on rising prices confirms accumulation. Volume-driven support is established at the $190–$192 pivot, where the highest-volume rejection occurred.
Relative Strength Index (RSI)
The 14-day RSI reads 56, recovering sharply from near-oversold (38) during the July 23 low but remaining below the overbought threshold. This positioning suggests moderate bullish momentum with room for extension. While rising, the RSI’s current level – coupled with volatility-adjusted averages – indicates limited near-term exhaustion risk.
Fibonacci Retracement
Applying Fibonacci to the March 25–July 21 primary rally ($127.50–$200.77), key retracement levels provided support: The July 23 low ($186.08) aligned precisely with the 23.6% retracement ($186.80). On the micro-scale, the July 21–23 decline ($200.77–$186.08) saw the price recover 100% of the loss, surpassing the 61.8% ($194.73) and 78.6% ($197.62) retracement barriers with conviction, affirming bullish strength.
Confluence and Divergence
Significant confluence appears at $186–$190, where the 23.6% Fibonacci level, 50-day moving average, and volume-based support converge. The MACD/KDJ bullish divergence at the July 23 low provided a high-probability reversal signal later confirmed by volume and candlestick patterns. Presently, Bollinger Band expansion, RSI trajectory, and volume characteristics align to favor continued upside bias. However, the KDJ's overbought tendencies diverge from MACD neutrality, suggesting potential near-term consolidation before challenging the $200.77 resistance. A decisive break above this level would likely trigger accelerated momentum.