Keysight Stock Surges 9.05% on Bullish Continuation Pattern as Technical Indicators Signal Strong Uptrend

Candlestick Theory

Keysight’s recent price action reflects a bullish continuation pattern, with four consecutive days of gains culminating in a 9.05% rise. The candlestick structure suggests a potential breakout above key resistance levels, particularly near the $176.83–$184.46 range established in late October. Support levels are likely to be found at prior troughs such as $162.19 (October 17) and $159.49 (October 10), where the stock has historically found buying interest. The absence of bearish reversal patterns like a shooting star or a bearish engulfing pattern supports the view that the upward trend remains intact.

Moving Average Theory

The 50-day moving average (calculated from the 50 most recent closing prices) is currently above both the 100-day and 200-day averages, confirming a short-to-mid-term uptrend. The 200-day average acts as a dynamic support level, currently around $163.00–$165.00, and the price has remained above it for much of the observed period. Convergence between the 50-day and 100-day averages near $170–$173 suggests strengthening momentum, while the 200-day average’s gradual upward drift reinforces the long-term bullish bias. A crossover of the 50-day below the 200-day (a “death cross”) would signal a potential reversal, but this scenario appears unlikely given the current trajectory.

MACD & KDJ Indicators

The MACD histogram has been expanding positively since late October, indicating accelerating momentum in the bullish phase. The recent “golden cross” (MACD line crossing above the signal line) on October 31 further validates the uptrend. The KDJ stochastic oscillator, however, shows mixed signals: while the %K line remains above %D, suggesting short-term bullish momentum, the RSI has approached overbought territory (above 70), signaling caution. A divergence between the KDJ and price action—where the oscillator forms lower highs despite rising prices—could foreshadow a pullback.

Bollinger Bands

Volatility has expanded in recent sessions, with the price nearing the upper Bollinger Band ($184.46). This suggests heightened buying pressure but also the risk of a mean reversion. The bands’ width has widened from a narrow contraction in mid-October, indicating a breakout phase. If the price closes below the 20-day moving average ($172.00–$173.00 range), it may trigger a test of the lower band, which currently sits near $160.00.

Volume-Price Relationship

Trading volume has surged during the recent rally, peaking at 2.4 million shares on October 31, validating the strength of the bullish move. However, the volume profile shows a slight tapering in the last two sessions, which could indicate waning momentum. A sustained increase in volume during a pullback would reinforce the trend’s resilience, while a decline might suggest a lack of conviction in the upward trajectory.

Relative Strength Index (RSI)

The RSI has reached overbought levels (>70), a classic warning of potential exhaustion. While this does not guarantee a reversal, it implies that the stock may experience a correction in the near term. A move below the 50 threshold would signal weakening momentum, whereas a rebound above 60 could indicate continuation. The RSI’s alignment with the MACD’s bullish divergence strengthens the case for a continuation, but traders should monitor for a breakdown below 40, which would confirm a shift in sentiment.

Fibonacci Retracement

Applying Fibonacci levels to the October 10–31 rally (from $159.49 to $182.96), key retracement levels are $171.00 (38.2%), $166.00 (50%), and $160.00 (61.8%). The stock has tested the 50% level ($166.00) twice in early October without a decisive break, suggesting it could serve as a temporary support zone. A failure to hold above $166.00 may trigger a deeper correction toward $160.00, where prior volume spikes indicate historical support.

Backtest Hypothesis

The backtest strategy described leverages the MACD golden cross for entry and death cross for exit, applied to Keysight’s 2022–2025 data. The results show a 20.8% annualized return, with the MACD remaining in positive territory throughout the period. However, the delayed death cross in October 2025 highlights a limitation: the strategy would have held the stock through a 14.5% gain in 2025, missing potential early exits. This aligns with the observed technical analysis, where the MACD’s bullish divergence and strong volume validated the trend’s continuation. To refine the strategy, integrating Fibonacci retracement levels (e.g., exiting at 38.2% retracement) or tightening the RSI overbought threshold (e.g., 65 instead of 70) could improve timing accuracy.