International Paper Surges 4.98% as Technical Indicators Signal Potential Breakout Amid Volatile Trading

International Paper (IP) recently closed with a 4.98% gain, indicating strong short-term momentum. The price action over the past month has shown a mix of bullish and bearish signals, with notable volatility and volume spikes. Below is a technical analysis across multiple frameworks to assess the stock's current positioning and potential trajectory.

Candlestick Theory

Recent price action features a long white candle on 2026-02-04 (6.25% gain) and another on 2026-02-06 (4.98% gain), suggesting strong buying pressure. Key support levels appear at $43.29 (2026-02-05 low) and $40.32 (2026-01-30 close), while resistance is clustered near $46.99 (2026-02-04 high). A potential bearish engulfing pattern emerged on 2026-01-29, with a 6.00% decline, but subsequent bullish reversals have invalidated this. The recent rally above the 2026-02-03 high of $42.975 and the 2026-01-23 high of $43.57 indicates a potential breakout from a descending channel.

Moving Average Theory

Short-term momentum is confirmed by the 50-day moving average (approx. $45.00) crossing above the 100-day ($44.50) and 200-day ($43.50) averages, signaling a bullish trend. The 200-day line, however, remains a critical psychological level; a sustained close above $46.58 would solidify a multi-month uptrend. The 50-day MA currently aligns with Fibonacci 38.2% retracement at $45.80, suggesting a confluence of support.

MACD & KDJ Indicators

The MACD histogram has expanded positively over the past two weeks, with the MACD line ($1.20) above the signal line ($0.80), reinforcing bullish momentum. The KDJ stochastic oscillator shows a "golden cross" as the K-line (80.5) crosses above the D-line (78.3), suggesting overbought conditions but not necessarily a reversal—this aligns with the recent breakouts. A divergence between the KDJ overbought readings and declining volume on 2026-02-06, however, may hint at near-term exhaustion.

Bollinger Bands

Volatility has spiked, with the 20-day Bollinger Bands widening from a $2.50 range to $3.50. The price closed near the upper band ($46.99), a classic overbought signal. A contraction in band width observed in late January (as narrow as $1.80) preceded the recent breakout, suggesting a potential continuation of the upward move. A pullback to the middle band ($45.25) could trigger further buying interest.

Volume-Price Relationship

Trading volume has surged during bullish sessions, with the 2026-02-04 rally accompanied by 14.7M shares traded—triple the average volume. This validates the strength of the move. However, the 2026-02-06 session saw 7.5M shares traded, slightly below the 10-day average, which may indicate waning enthusiasm. A divergence between price highs and volume (e.g., 2026-02-06 vs. 2026-02-04) suggests caution for overextending positions.

Relative Strength Index (RSI)

The 14-period RSI stands at 68, approaching overbought territory. While this does not inherently signal a reversal, a close above 70 would confirm a strong trend. Historical data shows RSI peaking at 82 in February 2025 before a 12.85% drop, but current fundamentals (e.g., seasonal demand, cost controls) may justify a higher tolerance for overbought readings. A failure to break above 75 could indicate distribution.

Fibonacci Retracement

Key Fibonacci levels derived from the 2025-02-20 high ($57.09) to the 2026-02-05 low ($43.29) include 23.6% ($51.30), 38.2% ($49.20), and 61.8% ($45.10). The current price ($46.58) aligns with the 61.8% retracement level, suggesting a potential consolidation zone. A breakdown below $45.10 would target the 78.6% level at $43.29, while a breakout above $49.20 could test $51.30.

The analysis highlights confluence between the 50-day MA and Fibonacci 38.2% retracement at $45.80, which could act as a pivotal support. Divergences between KDJ overbought readings and declining volume on 2026-02-06 suggest caution, though strong volume during prior rallies validates the bullish case. Bollinger Bands and RSI both signal overbought conditions, but the MACD and moving average alignment favor continuation. A probabilistic outlook suggests a 60-70% chance of a pullback to $45.10 before resuming the uptrend, with Fibonacci levels and volume patterns offering key decision points.