Reddit Rallies 11.42% In 3 Days As Technicals Signal Bullish Momentum

Reddit (RDDT) advanced 4.67% in the latest session, marking its third consecutive gain with an 11.42% rally over this period, closing at $159.34 on elevated volume. This upward momentum warrants a multi-indicator technical assessment.
Candlestick Theory
Recent sessions reveal a bullish reversal pattern emerging near the $140 psychological support. The June 27 doji candle at $143.01 signaled indecision after a decline, followed by three white soldiers (June 30-July 2) confirming bullish conviction. Key resistance now resides at the June 25 swing high of $153.94, while the $146.55-$148 zone acts as immediate support, aligning with the June 30 and July 1 lows.
Moving Average Theory
The 50-day MA ($135.80) crossed above the 100-day MA ($126.40) in late June, confirming a strengthening intermediate trend. Current price trades above all three major MAs (50/100/200-day), with the 200-day MA ($108.20) providing foundational support. The ascending 50-day MA slope suggests bullish near-term bias, though price distance from the 200-day MA warrants monitoring for potential mean reversion.
MACD & KDJ Indicators
The MACD histogram turned positive on June 28, with the signal line crossover confirming bullish momentum that aligns with recent gains. KDJ oscillators show overbought conditions (K:83, D:78, J:93), suggesting near-term exhaustion risk. However, the MACD's continued upward trajectory counterbalances this, indicating runway for momentum before significant reversal probability.
Bollinger Bands
The July 2 close touched the upper Bollinger Band ($158.20), typically indicating stretched short-term conditions. Bandwidth expanded 18% during the three-day rally, confirming volatility-driven upside. Historical precedent shows prices often consolidate or retrace after such events, with the middle band ($149.40) offering initial pullback support.
Volume-Price Relationship
Volume surged 25% above average on June 27's downswing, suggesting capitulation before the rally. The subsequent advance occurred on progressively higher volume (June 30: +14% avg, July 2: +31% avg), validating buyer conviction. The absence of volume divergence strengthens the sustainability case for current momentum.
Relative Strength Index (RSI)
The 14-day RSI (68) approaches overbought territory but shows no bearish divergence, maintaining higher highs with price. While extended, readings below the 70 threshold and the MACD confirmation reduce immediate reversal concerns. Historical instances of RSI >70 in May corresponded with 8-10% corrections, warranting vigilance.
Fibonacci Retracement
Applying Fibonacci to the March swing low ($86.91) and May peak ($168.52), key retracement confluence emerges at $140.36 (38.2%) and $127.72 (61.8%). Recent consolidation respected the 38.2% level, transforming it into support. The 23.6% level ($151.60) now acts as immediate resistance-turned-support after being breached in the current rally.
Confluence and Divergence Observations
Confluence appears at $140-$142, where the 38.2% Fibonacci, June 27 swing low, and volume-supported reversal coincide. The KDJ overbought signal diverges from MACD's continued strength, though this may resolve through consolidation rather than reversal given alignment in volume and MA trends. Key watchpoints include price reaction at $153.94 resistance and volume patterns on any retest of $151.60 support.