Lumentum Rises 3.19% Reversing 12.83% Drop; Bullish Engulfing and 10-Day MA Crossover Signal Optimism Amid Overbought RSI

Lumentum Holdings (LITE) closed at $334.69 on December 15, 2025, with a 3.19% gain, marking a technical reversal from the prior session’s sharp 12.83% decline. Candlestick Theory reveals a bullish engulfing pattern forming after a 5-day bearish trend, where the recent session’s close near the high of $348.75 suggests rejection of lower prices. Key support levels emerge at $319.29 (December 12 low) and $288.50 (December 3 low), while resistance aligns with the December 11 high of $374.97 and the December 10 high of $376.53.
Moving Average Theory indicates a short-term uptrend, with the 50-day MA (approx. $320–$330) currently below the 200-day MA (approx. $300–$310), suggesting a bearish intermediate-term bias. However, the 10-day MA crossing above the 50-day MA on December 12–15 hints at a potential short-term bullish crossover.
MACD & KDJ Indicators show mixed signals.

The MACD line crossed above the signal line on December 12, confirming a bullish momentum shift, but the RSI (calculated as ~72–75 over the past 14 days) suggests overbought conditions, increasing the risk of a pullback. The KDJ oscillator (Stochastic) reached overbought territory (~85–90), aligning with the RSI but diverging from the MACD’s bullish momentum, signaling a potential near-term reversal.
Bollinger Bands reflect heightened volatility, with the bands expanding after a contraction in late November. The price currently sits near the upper band ($348.75), indicating a high-risk zone for continuation or reversal. A break below the 20-day MA (approx. $330) could trigger a retest of the lower band ($302–$303).
Volume-Price Relationship reveals divergences. While the December 15 rally occurred on reduced volume (4.7M vs. 6.9M on December 12), the broader 5-day rally (December 9–15) saw mixed volume, with the December 9–12 surge (avg. 5M–7M) validating strength. However, declining volume on recent highs may weaken the sustainability of the rally.
RSI confirms overbought conditions (~73), with a caveat that strong fundamentals or news-driven momentum could extend the uptrend. A close below 60 would signal weakening momentum, while a retest of the 30–35 oversold level (~$280–$290) could trigger a countertrend bounce.
Fibonacci Retracement levels drawn from the November 14 low ($213) to the December 11 high ($374.97) show critical confluence at 61.8% ($319.29) and 78.6% ($353.00). The current price near $334.69 aligns with the 50% retracement level ($294.00), suggesting a potential pivot point for continuation or consolidation.
Confluence between the 50-day MA, Fibonacci 50% retracement, and bullish MACD suggests a short-term target of $350–$360, but overbought RSI and KDJ warn of a pullback to $319.29. Divergences in volume and oscillator momentum highlight the need for caution, with a breakdown below $319.29 likely to invalidate the bullish case.