Nutrien Surges 9.88% on Bullish Technical Signals; 54.00 Support and 58.94 Resistance in Focus

Candlestick Theory

Nutrien’s recent price action shows a four-day bullish streak, with the stock rising 9.88% from its prior lows. The candlestick patterns suggest a strong continuation bias, as higher highs and higher lows have formed a clear uptrend. Key support levels are emerging around the 54.00-54.50 range, where the stock previously consolidated before breaking out. Resistance appears at the 58.94 level (recent high), with potential for a pullback if this level fails to hold. A bearish reversal pattern, such as a shooting star or a dark cloud cover, could emerge if the price closes below the 54.00 psychological support, signaling a possible trend correction.

Moving Average Theory

The 50-day moving average (approximately 56.50) is above the 100-day (55.70) and 200-day (54.90) averages, indicating a medium-term bullish bias. The current price of 58.94 sits well above all three, reinforcing the uptrend. However, the 50-day MA is approaching the 100-day MA, suggesting a potential slowdown in momentum. A crossover of the 50-day below the 100-day would signal a bearish shift, though the broader trend remains intact as long as the 200-day MA remains below the price.

MACD & KDJ Indicators

The MACD histogram is expanding, with the line above the signal line, confirming bullish momentum. However, the KDJ stochastic oscillator shows %K and %D lines converging near overbought territory (80+), indicating potential exhaustion in the rally. This suggests a short-term correction may be due, though divergence between MACD and KDJ—where MACD remains strong while KDJ weakens—could point to a false reversal signal. Traders should watch for a bearish crossover in KDJ before considering short positions.

Bollinger Bands

Volatility has spiked, with the price near the upper Bollinger Band (59.22). The bands have widened recently, reflecting increased uncertainty. If the price closes below the middle band (56.47), it could signal a breakdown in the uptrend. Conversely, a sustained move above the upper band may indicate a continuation of the rally, albeit with elevated risk. The narrowest band contraction occurred in late October, preceding the recent surge, suggesting the current move is a post-consolidation breakout.

Volume-Price Relationship

Trading volume has surged during the recent rally, with the past four sessions averaging 2.3 million shares traded daily—a 30% increase from the 20-day average. This supports the sustainability of the uptrend, as rising volume aligns with price gains. However, a divergence may emerge if volume declines while the price continues higher, signaling waning conviction. The spike in volume on the most recent session (2.8 million shares) suggests strong institutional buying, which could prolong the rally.

Relative Strength Index (RSI)

The 14-day RSI is currently at 72, confirming an overbought condition. Historical data shows the RSI frequently exceeded 70 during the 2025-10-02 surge (5.51% gain) and again in late October, only to correct afterward. While overbought readings often precede pullbacks, Nutrien’s RSI has remained elevated longer than typical, likely due to strong fundamentals and sector momentum. A drop below 60 would suggest a bearish shift, but a rebound above 70 could indicate the uptrend remains intact.

Fibonacci Retracement

Key Fibonacci levels from the 2024-11-10 low (43.69) to the 2025-10-02 high (59.77) include 61.8% at 54.00 (current support) and 50% at 51.73. The price has tested the 38.2% level (56.73) twice in October without breaking it, suggesting strong demand above 54.00. A breakdown below 54.00 could target the 51.73 level, with the 200-day MA acting as a potential floor.

Backtest Hypothesis

The backtest strategy—buying Nutrien when RSI exceeds 70 and holding for five trading days—reveals mixed outcomes. While overbought RSI readings historically correlate with short-term corrections, Nutrien’s recent performance shows the stock often continues rising despite overbought conditions, particularly in a strong uptrend. For example, the October 2-6 rally saw RSI remain above 70 for three days before a pullback. A five-day holding period would have captured 1-2% gains in most instances, but risks whipsaw losses during false breakouts. This suggests the strategy may underperform in high-volatility environments unless combined with additional filters, such as volume confirmation or Fibonacci support levels.