Illinois Tool Works Jumps 3.22% As Technicals Signal Bullish Breakout

Candlestick Theory
Illinois Tool Works exhibits a notable bullish candle on July 1, 2025, closing near the session high ($255.21 vs. $257.63 high) with a 3.22% gain. This pattern, following a Doji-like indecision candle on June 30 (small range, -0.33% close), suggests renewed buying pressure. Key resistance is established at $257.63 (July 1 high), while support lies at $245.18 (June 30 low). The absence of long upper wicks in recent sessions indicates limited overhead supply, though the cluster of June 24–26 candles near $246–$248 may now act as interim support.
Moving Average Theory
The 50-day moving average (MA) has crossed above both the 100-day and 200-day MAs, signaling a bullish medium-term trend. Current price action ($255.21) trades above all three key MAs (50/100/200), confirming positive momentum. The 200-day MA near $245 anchors long-term support, while the 50-day MA ($248) provides dynamic short-term support. A Golden Cross formation (50-day crossing 200-day) occurred in mid-June, historically a reliable bullish indicator when confirmed by volume.
MACD & KDJ Indicators
MACD (12,26,9) shows a bullish crossover in late June, with the histogram expanding positively — indicative of accelerating upward momentum. Concurrently, KDJ oscillators reflect overbought but resilient conditions: %K (79) and %D (75) have steeply rebounded from oversold territory in early June, while %J (87) suggests potential short-term exuberance. While not yet diverging, KDJ’s proximity to overbought levels warrants monitoring for exhaustion signals, especially if MACD’s histogram momentum falters.
Bollinger Bands
Bollinger Bands (20-day, 2σ) contracted sharply during June’s consolidation ($240–$249 range), signaling reduced volatility. The July 1 breakout above the upper band ($254) reflects a volatility expansion, typically preceding strong directional moves. Price now trades 1.3% outside the upper band, suggesting near-term overextension. A sustained close above $257.63 would validate upside continuation; failure may trigger a reversion toward the middle band ($250).
Volume-Price Relationship
Recent bullish confirmation is evident: July 1’s 3.22% surge occurred on elevated volume (1.08M shares vs. 30-day avg ~0.92M), indicating conviction. Notably, June’s pullbacks (e.g., June 13 and 20) saw lower volume, signaling limited selling pressure. Cumulative volume since the April low ($224.94) shows higher volume on up days—a hallmark of accumulation—supporting trend sustainability absent volume divergences.
Relative Strength Index (RSI)
14-day RSI currently reads 68, approaching overbought territory (>70) but not yet signaling exhaustion. The indicator has consistently held above 50 since early June, reflecting strengthening momentum. Historical caution notes: RSI has previously peaked near 75 during March 2025’s rally before a correction. Probabilistically, RSI values >65 alongside new price highs warrant vigilance for bearish divergences, though no such divergence is presently evident.
Fibonacci Retracement
Applying Fibonacci to the recent uptrend from the April 4 swing low ($224.94) to the July 1 high ($257.63):
- 61.8% retracement ($257.81) nearly coincides with current resistance.
- 50% level ($241.29) aligns with the 200-day MA and June lows, reinforcing key support.
Confluence exists at $257–$258 (61.8% Fib + July 1 high), creating a critical resistance zone. A decisive close above $258 would open the 78.6% retracement ($266), while rejection here may trigger a pullback toward $247–$250 (38.2% Fib + 50-day MA).
Confluence and Divergence Summary
Significant confluence supports the bullish case:
- Golden Cross (MAs), MACD crossover, and volume-backed breakout align.
- RSI neutrality and Bollinger Band overextension offer probabilistic caution but no active sell signals.
No critical divergences exist; all momentum indicators align with price strength. However, the $257–$258 Fibonacci/price resistance zone presents a make-or-break level. A close above $258 on sustained volume would signal continuation toward $266, while rejection at this level may trigger profit-taking toward $247–$250 support. Traders should monitor volume trends and KDJ for early reversals, though momentum currently favors upside.