Pure Storage Jumps 5.42% to $86.76 on Bullish Technical Breakout With Heavy Volume

Pure Storage (PSTG) surged 5.42% in the latest trading session, closing at $86.76 with notably high volume of 4.7 million shares, suggesting strong bullish momentum. This analysis evaluates the technical landscape using multiple frameworks.
Candlestick Theory
Recent candlesticks reveal a bullish reversal pattern. The stock formed a hammer on September 12 near $82.06 support, followed by three consecutive white candles, culminating in a large bullish marubozu on September 15 that broke through the $85 resistance. This pattern signals strong buying pressure and invalidates the prior bearish consolidation between $82–$84. Immediate support now lies at $85 (previous resistance), while resistance emerges at the psychological $90 level.
Moving Average Theory
The 50-day MA (~$63) sits below the 100-day (~$57) and 200-day (~$55), confirming a major long-term uptrend. Shorter-term, price reclaimed the 20-day MA ($79) on September 10, triggering acceleration. Current bullish alignment is reinforced by the golden cross between 50-day and 200-day MAs. Sustained trading above the rising 50-day MA ($83) suggests intermediate trend strength.
MACD & KDJ Indicators
MACD exhibits a bullish crossover above its signal line with histogram bars expanding, indicating strengthening momentum. KDJ shows %K (85) and %D (82) in overbought territory but maintaining upward slope, supporting near-term bullishness. No bearish divergence is observed, though overbought KDJ levels warrant monitoring for potential consolidation.
Bollinger Bands
Price is testing the upper Bollinger Band ($86.50), while bands widened sharply after the September 15 breakout – a volatility expansion confirming trend strength. The breakout from a multi-week band squeeze (August 20–September 8) resolved upward. Near-term mean reversion toward the 20-period midline ($82) could offer buying opportunities if volume supports.
Volume-Price Relationship
Volume surged 165% on the September 15 breakout, validating the bullish move. Preceding consolidation saw declining volume, suggesting lack of seller conviction. The late-August rally from $60–$80 occurred on record volume (20M+ shares on August 28), establishing high-confidence support at $75–$78. Current volume profile supports continuation.
Relative Strength Index (RSI)
The 14-day RSI (68) approaches overbought territory but hasn’t crossed 70, leaving room for upside. It rebounded sharply from neutral (50) during the September breakout. While warning signals would trigger above 70, current momentum alignment reduces immediate reversal risks. Longer-term weekly RSI (75) confirms structural strength.
Fibonacci Retracement
Applying Fib levels to the rally from April’s low of $40.21 to September’s $87.17 high, key retracements converge with technical supports. The 38.2% level ($68.50) aligns with the 100-day MA and August swing low – a major support zone. Recent pullbacks to the 23.6% level ($78.20) attracted buyers, reinforcing $78–$80 as strong confluence support. Upside targets include the 127.2% extension at $95.
Confluence and Divergence
Bullish confluence dominates: Volume-backed breakout, MACD/KDJ momentum agreement, and MA alignment collectively target $90. RSI divergence is absent. The lone caution stems from Bollinger Band proximity and KDJ overbought readings, favoring pullbacks to $84–$85 as buying opportunities. Primary risk would emerge only below $78 (volume-supported Fib level). Probable upside prevails barring volume deterioration.