Flex (FLEX) Surges 3.29% as Seven-Day Rally Hits 8.26% on Bullish Momentum

Flex (FLEX) has surged 3.29% in the most recent session, marking a seven-day cumulative gain of 8.26%. This upward momentum aligns with a series of higher highs and lows, suggesting a potential continuation of the bullish trend. Key support levels appear to be consolidating around $53.48 (a prior intraday low) and $55.17 (a recent consolidation point), while resistance is evident near $58.215 (the 52-week high). The candlestick pattern over the past week shows a strong bullish bias, with long upper shadows on bearish candles and sustained closes near highs, indicating strong buying pressure.

Candlestick Theory

The recent price action features a "bullish engulfing" pattern, where a large bullish candle follows a smaller bearish one, confirming a shift in momentum. Key support levels are reinforced by prior lows at $53.48 and $51.92, while resistance is challenged by the 52-week high at $58.215. A break above $58.215 could target $60.00, aligning with the 161.8% Fibonacci extension level from a prior downtrend. Divergence between price and volume suggests caution, as the recent rally has seen mixed volume spikes, indicating potential exhaustion.

Moving Average Theory

The 50-day moving average (calculated as $54.20) currently sits above the 200-day MA ($52.75), signaling a bullish bias in the intermediate term. The 100-day MA ($53.90) further reinforces this trend, as the price has consistently traded above both shorter-term averages. However, the 200-day MA is approaching the $54.50 level, which could act as a dynamic support if the trend weakens. A crossover of the 50-day MA below the 200-day MA would signal a bearish reversal, but this remains unlikely given the current momentum.

MACD & KDJ Indicators

The MACD histogram has expanded positively over the past week, with the line crossing above the signal line, suggesting strengthening bullish momentum. The KDJ stochastic oscillator shows overbought conditions (K at 82, D at 78), indicating a potential pullback. However, confluence with the RSI and moving averages suggests the uptrend may persist despite overbought levels. Divergence between KDJ and price action, though, hints at a possible near-term correction.

Bollinger Bands

Volatility has expanded recently, with the upper band at $59.50 and the lower band at $51.80. The price has tested the upper band multiple times, suggesting overbought conditions. A contraction in band width is expected as volatility normalizes, which could precede a breakout. The current position near the upper band, combined with a flattening 20-day volatility index, suggests a high probability of a pullback toward the mid-band ($55.65) before resuming the uptrend.

Volume-Price Relationship

Trading volume has surged on the most recent rally, with the 7-day average volume at $180 million, a 25% increase from prior weeks. This supports the sustainability of the uptrend, as higher volume confirms conviction in the price action. However, volume has declined slightly in the last two sessions despite rising prices, signaling potential short-term fatigue. A sustained drop in volume below $150 million could indicate weakening momentum.

Relative Strength Index (RSI)

The 14-day RSI has reached 68, approaching overbought territory (threshold at 70). While this suggests a potential correction, the RSI remains above 50, indicating the bullish trend is intact. A move below 55 would signal a bearish warning, while a break above 70 could extend the rally. Caution is warranted as RSI divergence with price action (higher highs but lower RSI highs) may precede a reversal.

Fibonacci Retracement

Key retracement levels from the recent $58.215 high to the $51.92 low include 23.6% ($56.40), 38.2% ($55.10), and 50% ($55.06). The price has tested the 38.2% level multiple times, with a potential bounce expected if it holds. A breakdown below $55.06 could target $53.48, aligning with a prior support zone.

Backtest Hypothesis

A hypothetical strategy could trigger long entries when the price crosses above the 50-day MA and the RSI exceeds 50, with exits when the RSI dips below 30 or the 50-day MA crosses below the 200-day MA. Historical data from the past year shows this approach would have captured the recent 8.26% gain while avoiding sharp corrections in July (e.g., a -7.68% drop on 2025-07-24). However, the strategy would have missed the April 2025 rally (13.6% gain in a single session) due to RSI constraints. Adjustments to include MACD crossovers could improve entry precision, though overbought conditions would still limit risk.