Reddit Stock Surges 8.06% To $121.29 As Bullish Indicators Align

Candlestick Theory
The latest session on 2025-06-06 formed a robust bullish candle with an 8.06% surge, closing near the day’s high of $121.29 after testing intraday support at $112.77. This pattern suggests strong rejection of lower prices, reinforcing the $112–$110 zone as critical support, anchored by the 2025-06-04 low ($110.87). Resistance is evident near $125–$130, where prior swing highs (2025-05-14’s $130.11 and 2025-05-02’s $125.39) converge. A recent bearish engulfing candle on 2025-06-05 was quickly invalidated, underscoring underlying bullish sentiment.
Moving Average Theory
Reddit’s price ($121.29) trades above all key moving averages—50-day (~$108), 100-day (~$105), and 200-day (~$100)—indicating sustained upward momentum. The 50-day MA acted as dynamic support during the early June pullback, while the ascending 50/100/200-day alignment confirms a long-term bull trend. A golden cross (50-day above 200-day) formed in late April, further validating structural strength.
MACD & KDJ Indicators
The MACD histogram has turned positive after a bullish crossover, signaling accelerating upward momentum. However, the KDJ indicator shows potential overbought conditions, with the K-line at 88 and D-line at 82—both above the 80 threshold. While this suggests near-term exhaustion risk, the MACD’s strength implies any pullback could be short-lived. Divergence is absent, supporting trend continuity.
Bollinger Bands
Bollinger Bands contracted sharply in late May, reflecting volatility compression before the current breakout. The price now rides the upper band ($120), confirming bullish momentum. Band expansion supports continuation, though proximity to the upper band warns of overheated conditions. A close below $118 would signal potential retracement toward the middle band ($115).
Volume-Price Relationship
The breakout on 2025-06-06 occurred on 6.73M shares, above the 20-day average but below the spike volume of 8.68M on 2025-06-04. This divergence slightly undermines conviction, though cumulatively elevated volume since late May validates underlying demand. The 2025-05-14 sell-off (20.75M shares) remains an outlier, emphasizing $113–$125 as a high-volume resistance zone.
Relative Strength Index (RSI)
The 14-day RSI reads 67, nearing overbought territory (>70) but lacking divergence. While not yet overextended, it flags limited near-term upside without consolidation. Historically, RSI peaks above 75 (e.g., April 2025) preceded pullbacks, warranting vigilance. Current momentum may sustain if RSI holds below 70 during advances.
Fibonacci Retracement
Drawing Fibonacci from the March 2025 high ($158.02) to May low ($88.89), key retracement levels emerge: 38.2% ($115.20), 50% ($123.45), and 61.8% ($131.70). The price has surpassed the 38.2% level, targeting the pivotal 50% zone near $123.45. A decisive close above $123 would expose the 61.8% retracement. The 2025-06-04 low ($110.87) aligns with the 23.6% support ($109.50), reinforcing this floor.
Conclusion
Multiple indicators converge toward near-term bullishness: Bullish candlestick rejection, moving average support, MACD uptick, and Bollinger Band expansion align with Reddit’s breakout. However, KDJ overbought signals, RSI proximity to 70, and volume divergence warrant caution. Key resistance at $123.45 (50% Fibonacci) must be cleared for further upside, while failure to hold $112 support risks a retest of the 200-day MA ($100). Probabilistically, the bias leans bullish above $115, but consolidation below $123 is likely before sustainable gains materialize.