Figma Stock Soars 16.83% Extending Five-Day Rally To 41.31%

Figma(FIG) concluded the latest session with a significant 16.83% surge, marking its fifth consecutive day of gains and bringing its five-day rally to an impressive 41.31%. This robust performance forms the basis of the following multi-faceted technical assessment of Figma's stock.
Candlestick Theory
Recent sessions showcase a powerful sequence of long green (bullish) candles, particularly notable on 2025-10-08 (+16.83%), 2025-10-06 (+7.39%), and 2025-10-07 (+6.81%). These large real bodies, breaking decisively through the established $60-$65 consolidation range observed in late September, signify strong buying pressure and a confirmed breakout. The absence of significant upper shadows on the last two large up-days suggests limited immediate overhead resistance, though the psychological $70-$72 area remains pivotal. Key support now rests near the breakout point around $60-$62, previously acting as resistance. The long-term trough near $50 (August lows) offers major support, while the 2025-09 peak near $69-$71 acts as potential near-term resistance.
Moving Average Theory
A significant development is the formation of a short-term golden cross, with the 10-day EMA rising sharply above the 20-day EMA, confirming strong recent momentum. However, the stock currently trades well above the calculated longer-term moving averages: the 50-day SMA (~$68 based on the dataset) and the 200-day SMA (significantly higher, near ~$80+). This large positive divergence suggests the short-term uptrend is becoming increasingly extended relative to the medium to long-term trend. While bullish in the near term, this positioning warrants caution as it increases susceptibility to a mean-reversion pullback towards the 50-day SMA.
MACD & KDJ Indicators
The MACD line shows strong bullish momentum, accelerating above its signal line, supporting the breakout thesis. However, the KDJ indicator presents a critical warning sign: the %K line has entered deeply overbought territory above 90 (likely significantly higher), far exceeding the %D line. While MACD confirms momentum, this pronounced overbought condition flagged by the KDJ oscillator suggests the buying may be overheating and susceptible to exhaustion. This divergence warrants close monitoring.
Bollinger Bands
Figma's price has thrust upwards, piercing the upper Bollinger Band during its latest surge. This breakout follows a period of band contraction in late September, indicating a compression phase resolved with explosive upside volatility. While breaching the upper band typically signals strength, sustained trading above it is uncommon and often precedes a short-term pullback or consolidation, especially when coinciding with other overbought signals. The expansion of the bands themselves validates the increase in volatility triggered by the breakout.
Volume-Price Relationship
The breakout over the past five days has been validated by a notable increase in trading volume, particularly evident on 2025-10-08 (27.1M shares), 2025-10-06 (28.0M), and 2025-10-07 (25.1M), significantly exceeding the volume seen during the preceding consolidation in late September. This strong volume surge confirms buyer conviction behind the price advance. However, a slight decrease in volume on the last day of the surge (Oct 8th vs Oct 6th), despite the largest price gain, introduces a minor note of caution regarding the sustainability of accelerating gains at the very peak of the move.
Relative Strength Index (RSI)
Calculated RSI based on the 14-day average would be exceedingly high, likely well into the mid-80s or higher, far surpassing the traditional overbought threshold of 70. While an overbought RSI alone doesn't signal an immediate reversal, particularly during powerful bullish trends, its extreme level combined with the sharp, vertical ascent suggests significant near-term overheating. This extreme reading significantly increases the probability of a consolidation phase or pullback emerging soon. It serves as a strong warning to anticipate potential exhaustion.
Fibonacci Retracement
Using the major downswing from the July 31st peak ($115.50) to the August 4th low ($88.60) as a baseline, critical Fibonacci levels emerge. The current price (~$71.08) sits near the significant 61.8% retracement level ($~73.00). This level represents a classic potential reversal zone where profit-taking pressure often intensifies. A decisive break above $73.00 would target the 78.6% retracement near $84.50. Conversely, initial support resides around the 50% retracement level ($63.50), aligning with the recent breakout zone near $60-$62.
Confluence and Conclusions
A compelling confluence of signals validates the breakout: strong bullish candles, expanding volume, MACD momentum confirmation, a short-term golden cross, and Bollinger Band expansion. However, several significant technical warnings emerge simultaneously. Figma trades far above key moving averages and near a major Fibonacci resistance level ($73). It exhibits extreme overbought conditions flagged by both RSI (>85) and KDJ (%K >90), alongside its position above the Bollinger Band. The slight volume dip on the largest gainer day, while volume remains high overall, slightly undermines the accelerating breakout thesis at the peak. This combination of bullish breakouts and extreme overbought divergences suggests the immediate upside potential may be constrained. A period of consolidation or a modest pullback towards the $65-$67 area (aligning with the recent breakout level and the 50-day SMA) appears highly probable in the near term to relieve overbought pressures, before potentially resuming its longer-term trajectory. The strength of the underlying volume-supported breakout, however, implies any pullback may find solid buyer support.