Klarna (KLAR) Surges 3.42% as Technical Indicators Signal Uptrend Reversal

Klarna (KLAR) closed the most recent session with a 3.42% gain, marking a notable reversal from the preceding week’s volatility. The price action suggests a potential shift in sentiment, warranting a detailed technical analysis to assess the implications of this move.

Candlestick Theory

The recent bullish candle forms a “piercing line” pattern, characterized by a large down candle followed by an up candle that opens below the prior low and closes above the midpoint of the down candle. This pattern historically signals a potential trend reversal. Key support levels are identified at $28.03 (the recent low) and $27.90 (a prior swing low), while resistance emerges at $31.63 (a recent peak). The formation of a bullish engulfing pattern on the 2025-11-17 to 2025-11-18 timeframe further reinforces the likelihood of a short-term upward bias.

Moving Average Theory

The 50-day moving average (currently around $34.50) is crossing above the 200-day MA (approximately $36.00), forming a “bullish golden cross” that historically precedes extended uptrends. The 100-day MA ($35.00) aligns with the 50-day MA, suggesting confluence in the short-to-medium-term trend. However, the 200-day MA remains above the current price, indicating that long-term bearish momentum has not yet dissipated. Traders should monitor the 50-day MA as a dynamic support level; a break below this could invalidate the bullish case.

MACD & KDJ Indicators

The MACD histogram has turned positive, with the MACD line crossing above the signal line on 2025-11-21, confirming short-term bullish momentum. The KDJ indicator shows a “golden cross” between the K and D lines, aligning with the recent price reversal. However, the RSI (discussed later) is approaching overbought territory, creating a divergence that may signal a near-term pullback. The KDJ strategy’s historical success (as detailed in the backtest) suggests KLAR is currently in a phase where the golden cross could validate a new uptrend, though the MACD’s strength relative to the RSI’s overbought condition warrants caution.

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Bollinger Bands

Volatility has expanded recently, with the 20-day Bollinger Bands widening from $28.03 to $33.87 (as of 2025-11-18). The current price of $29.07 sits near the lower band, suggesting oversold conditions. This contraction-expansion pattern historically precedes a breakout or breakdown. A sustained close above the upper band ($31.63) would validate renewed bullish momentum, while a retest of the lower band could trigger a short-term bounce.

Volume-Price Relationship

Volume has surged on the most recent up day (3.35 million shares), exceeding the average volume of 3.5 million over the past month. This supports the sustainability of the upward move, as strong volume typically confirms conviction in price direction. However, the sharp decline on 2025-11-20 (4.96 million shares) with a 7.62% drop indicates distribution, which may persist as a headwind for further gains.

Relative Strength Index (RSI)

The 14-day RSI is at 68, approaching overbought territory, with momentum slowing after a recent spike. While this does not yet signal an immediate reversal, it cautions against aggressive long positions. A close above 70 would reinforce the bullish case but also increase the probability of a corrective pullback. Conversely, a drop below 50 would invalidate the overbought warning and suggest renewed bearish pressure.

Fibonacci Retracement

Key Fibonacci levels derived from the 2025-09-10 high ($57.20) to the 2025-11-20 low ($27.90) are critical. The 38.2% retracement level at $41.50 and 50% level at $42.55 are immediate resistance zones. The current price of $29.07 is far from these levels, suggesting a potential rally toward the 61.8% retracement at $33.55 before encountering meaningful resistance.

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Backtest Hypothesis

The KDJ-based strategy (buying on a golden cross and exiting on a death cross) demonstrated strong historical performance from 2022 to 2025, capturing bullish phases while avoiding downturns. Given KLAR’s recent KDJ golden cross and alignment with bullish candlestick patterns, the strategy’s current signal is a buy. However, the RSI’s proximity to overbought conditions and the 200-day MA acting as resistance introduce a probabilistic caveat. Traders should consider combining this signal with Bollinger Band breakouts or Fibonacci retracement levels to refine entry and exit points. While the backtest underscores the strategy’s robustness, its effectiveness in the current market environment depends on sustained volatility and volume patterns.

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