General Mills Rises 3.6% As Technical Indicators Signal Potential Reversal

General Mills (GIS) rose 3.60% to close at $50.95 in its latest session, reversing recent weakness as the stock rebounded from a multi-month low of $49.04. This comprehensive technical analysis evaluates key indicators across multiple frameworks to contextualize the price action.
Candlestick Theory
The formation of a hammer pattern at $49.04 on July 21 followed by a bullish engulfing candle on July 22 signals potential trend reversal. This two-day pattern emerged near the psychological $50 level, which now offers minor support. Significant resistance lies near $51.58 (July 11 high), aligning with the upper bound of recent consolidation. A decisive close above $51.58 would validate bullish conviction, while failure to hold $50 may revisit the $49.04 swing low.
Moving Average Theory
The stock remains in a long-term downtrend, trading below all major moving averages (50-day: $52.87, 100-day: $55.41, 200-day: $58.32). Bearish sequencing persists with the 50-day below the 100-day and 200-day, confirming structural weakness. However, the 3.60% rally places price 2.1% above the 20-day exponential moving average ($49.91), suggesting potential near-term mean reversion. The sustained gap between current price and the 200-day MA (-12.6%) indicates broader bearish control.
MACD & KDJ Indicators
MACD shows nascent bullish divergence as the histogram turned positive for the first time in three weeks, though still below the signal line. The crossover occurred as price reached new lows while MACD failed to confirm, suggesting weakening downward momentum. KDJ readings exited oversold territory with the %K line (54) crossing above %D (43), though both remain below the 70 overbought threshold. This momentum shift may precede further near-term recovery, though the MACD’s position below zero warrants caution.
Bollinger Bands
Price closed near the upper band ($50.98) after a period of band contraction (Bollinger Band Width narrowed 15% in prior sessions), confirming the volatility expansion. This represents the first close above the 20-day moving average ($49.91) since July 3. The breakout from the lower half of the bands supports continuation potential, but sustainability requires confirmation through maintained upper-band proximity in subsequent sessions.
Volume-Price Relationship
The rebound occurred on 6.1 million shares traded – 22% above the 20-day average – validating the bullish reversal. Volume expanded as price recovered from the $49.04 low, signaling accumulation. However, volume remains below the 8.1 million share capitulation spike seen on June 25. Further upside requires consistent volume expansion above the 50-day average (5.3 million shares) to confirm institutional participation.
Relative Strength Index (RSI)
The 14-day RSI rebounded from oversold (29.3) to 45.8 after the rally, exiting the bearish zone but remaining below neutral 50. This aligns with July’s pattern where RSI failed to breach 60 during recovery attempts, demonstrating persistent bearish momentum. While not overbought, the indicator remains closer to oversold territory, suggesting caution is warranted despite recent strength.
Fibonacci Retracement
Using the April 1 high ($59.72) and July 21 low ($49.04), key retracement levels emerge at $51.56 (23.6%) and $53.12 (38.2%). The latest close at $50.95 sits just below the 23.6% threshold. This Fibonacci resistance converges with the July 11 swing high ($51.58), creating a significant technical hurdle. A decisive break above $51.60 would target $53.12, while rejection here may retest $49.
Confluence and Divergence Observations
Bullish confluence appears near $49 support: hammer candlestick, MACD divergence, and volume-backed reversal aligned at this level. The breakout above Bollinger’s midline reinforces near-term momentum. However, bearish divergence persists between price and the 200-day MA trend. Primary resistance between $51.56-$51.58 represents critical make-or-break territory where Fibonacci, horizontal resistance, and the descending 20-day EMA converge. Monitoring this zone is essential – a confirmed breakout could extend gains to $53, while rejection would validate ongoing bearish structure.