Lam Research Rises 3.35% as Technical Indicators Signal Recovery Momentum

Lam Research (LRCX) shares advanced 3.35% in the most recent session, closing at 99.15, amid a technical recovery from recent consolidation. The following analysis applies a multi-indicator framework to evaluate the stock's trajectory.
Candlestick Theory
The August 7 session formed a robust bullish candle that fully eclipsed the prior day's bearish body, signaling a potential reversal. This pattern emerged near the critical support of 94.27 (August 6 low) and breached interim resistance at 97.97 (August 7 low). Key resistance now converges at the psychological $100 level, which has capped multiple tests since mid-July. The swing high of 101.74 (July 21) remains the primary technical barrier.
Moving Average Theory
Price currently trades above the 50-day SMA (~95.5), confirming the intermediate uptrend's resilience. The 50/100/200-day SMAs maintain a bullish alignment (50 > 100 > 200), with the 100-day SMA (~88.0) and 200-day SMA (~84.5) providing dynamic support. The August 1 rebound from the 200-day SMA reinforced the long-term uptrend, though the 50-day SMA has turned flat recently, reflecting consolidation.
MACD & KDJ Indicators
The MACD histogram is recovering from a bearish crossover triggered during July's correction, with the signal line flattening near the zero line. This suggests weakening downward momentum. The KDJ oscillator exited oversold territory (K: 35, D: 38, J: 29 on August 6) after the rebound, though remains below the overbought threshold. Confluence appears as both indicators show nascent recovery signals without clear divergence.
Bollinger Bands
Bands contracted sharply in late July (width: ~15% below average), preceding the breakdown to the lower band on July 31. The subsequent rebound has pushed price toward the mid-band (~97.5), with the August 7 close near the upper band (99.15 vs. upper band ~100.8). This band expansion supports continuation potential, though a close above the upper band would signal overbought conditions.
Volume-Price Relationship
Distribution days marked the July decline (notably July 31 volume: 27.7M shares, -4.29% close), confirming selling pressure. The August 7 advance occurred on below-average volume (9.55M vs. 10.63M prior), introducing sustainability concerns. However, the August 1 reversal hammer candle recorded significantly higher volume (16.6M shares), validating support near 92.47.
Relative Strength Index (RSI)
The 14-day RSI rebounded from oversold territory (28.5 on July 31) to 58.7 by August 7, reflecting improving momentum. While neutrality persists, the absence of overbought conditions (RSI <70) suggests room for upside. The RSI's higher low on August 6 versus price's lower low formed a bullish divergence, signaling waning bearish momentum.
Fibonacci Retracement
Applying Fib levels to the May 30 low (80.79) and July 21 high (101.74) shows the July correction bottomed near the 61.8% retracement (90.93 on July 31). The subsequent rebound now challenges the 23.6% level (98.26), coinciding with the $100 resistance. A sustained break above this Fib-confluence zone may open a path to new highs.
Confluence and Divergence Synthesis
Strong confluence exists at $98-100, where Fibonacci, psychological resistance, and the Bollinger upper band converge. Bullish candlestick reversal signals align with RSI divergence and KDJ recovery. However, volume divergence on the August 7 advance and MACD's position below its signal line warrant caution. The stock may require volume-backed clearance above $100 to invalidate bearish momentum fully and resume its primary uptrend.