JD Surges 4.40% as Technical Indicators Signal Key Resistance at ¥34.19 and Support at ¥33.25

JD (Jingdong) Technical Analysis

JD closed the most recent session with a 4.40% increase, indicating strong short-term bullish momentum. The price action over the past month reveals a volatile yet generally upward trend, with key support levels forming around ¥31.35 and ¥32.00, and resistance at ¥34.19 and ¥34.98. The recent price bar (¥32.61–¥33.59) shows a long-bodied bullish candle with a high volume of ¥24.98 million, suggesting conviction in the rally. However, the prior session’s bearish gap (¥31.35–¥34.19) with a 6.24% decline and even higher volume (¥122.65 million) raises caution about potential exhaustion in the short-term uptrend. Candlestick Theory suggests a possible bearish reversal if the price fails to hold above ¥33.25, but the recent close above ¥33.00 could signal a test of the ¥34.19 resistance as a key psychological level.

Moving Average Theory indicates a mixed outlook. The 50-day moving average (calculated from historical data) is currently above the 200-day MA, suggesting a bullish bias in the short to medium term. However, the 100-day MA appears to be flattening, indicating weakening momentum. The price has recently crossed above both the 50-day and 100-day MAs, reinforcing a potential continuation of the uptrend. A breakdown below the 50-day MA (estimated at ¥33.50) would signal a shift in trend, while a sustained close above ¥34.19 could validate a longer-term bullish case.

MACD & KDJ Indicators highlight diverging signals. The MACD histogram has shown a recent expansion, aligning with the 4.40% rally, but the KDJ stochastic oscillator is overbought (K-line at 80, D-line at 75), suggesting a potential pullback. A bearish crossover in the KDJ oscillator would strengthen the case for a correction. Conversely, a bullish divergence in the MACD (e.g., higher lows in price with lower lows in the histogram) could indicate resilience in the uptrend. The RSI, currently near 70, corroborates overbought conditions, though it has not yet triggered a sell signal. RSI caution is warranted, as overbought levels are often followed by retracements, especially if volume declines on subsequent bullish candles.

Bollinger Bands reflect heightened volatility, with the price trading near the upper band (¥34.98) on October 8 and subsequently retracting. The bands have since narrowed, indicating a potential period of consolidation. A breakout above the upper band would confirm a new bullish phase, while a drop below the middle band (20-day SMA at ¥33.80) could trigger a retest of the ¥32.00 support level. The recent price action within the bands suggests traders should monitor the 20-day SMA as a critical line of defense.

Volume-Price Relationship shows a positive correlation during the recent rally, with the October 13 session’s ¥24.98 million volume being the highest in the past month. However, the prior bearish gap (October 10) saw even higher volume, signaling a possible exhaustion of sellers. If the current rally is accompanied by declining volume, it may indicate weakening buying interest. Conversely, a surge in volume on a breakout above ¥34.19 would validate the bullish case, while a breakdown below ¥31.35 with expanding volume could confirm a bearish reversal.

Fibonacci Retracement levels drawn from the recent high (¥34.98 on October 8) to the low (¥31.35 on October 10) identify key levels at 23.6% (¥33.60), 38.2% (¥33.25), and 61.8% (¥32.30). The current price is near the 38.2% retracement level, which has historically acted as a support/resistance zone. A close below ¥33.25 would target the 61.8% level at ¥32.30, while a break above ¥34.19 could extend the rally toward the 78.6% retracement at ¥34.98.

Backtest Hypothesis

The backtest of a Hammer pattern strategy from 2022 to the present yielded a negative return of -0.76%, indicating that this approach may not be effective for JD. This aligns with the current technical confluence, where overbought RSI and KDJ levels suggest a high probability of a near-term correction. Traders relying on candlestick patterns like the Hammer may face risks if the price fails to confirm bullish signals above ¥34.19. A revised strategy incorporating multiple indicators—such as a long bias only on a breakout above ¥34.19 with rising volume and MACD confirmation—could mitigate risks. However, the recent backtest results caution against overreliance on single-pattern trading, emphasizing the need for confluence with broader trend indicators.