Sandisk (SNDK) Surges 6.11% on Bullish Engulfing Pattern as 50-Day MA Crosses Above 100-Day MA

Sandisk (SNDK) surged 6.11% in the most recent session, closing at $232.86. This sharp reversal follows a 2.67% decline on the prior day, forming a potential bullish engulfing pattern. Key support levels are evident at $219.46 (Dec 9 close) and $213.50 (Dec 9 low), while resistance aligns with the Dec 10 high of $234.17. The price action suggests short-term buyers are retesting prior resistance, with the 50-day moving average (approximately $225–$230) now in bullish alignment with the 200-day MA (around $200–$210). However, the 100-day MA (~$220) may act as a near-term floor if the rally falters.

Moving Average Theory
The 50-day MA is ascending, crossing above the 100-day MA, confirming a bullish trend. The 200-day MA remains a critical reference point, with the current price comfortably above it. A potential "death cross" (50-day MA crossing below 200-day) appears unlikely in the near term, given the recent volume-driven rally. Short-term momentum favors the 50-day MA as a dynamic support level, while the 200-day MA could offer a safety net should volatility resurface.
MACD & KDJ Indicators
The MACD histogram is expanding positively, with the line above the signal line, reinforcing the bullish bias. The stochastic oscillator (KDJ) shows overbought conditions, with %K (~85) and %D (~80) near the 80–90 threshold, suggesting a potential near-term pullback. Divergence between the MACD and RSI could emerge if the rally outpaces momentum indicators, though the current alignment supports continuation.
Bollinger Bands
Volatility has spiked, with the price nearing the upper band ($234.17). The bands are widening after a period of contraction in early December, signaling a breakout phase. A sustained close above the upper band may trigger further gains, while a retest of the lower band ($215–$217) could confirm the trend’s resilience.
Volume-Price Relationship
Trading volume surged to 6.09 million on the Dec 10 rally, the highest in over a week, validating the bullish move. However, volume has been mixed in preceding sessions, with the Dec 9 selloff (6.3 million) and Dec 8 consolidation (8.7 million) showing uneven participation. Sustained volume above 6 million would strengthen the case for a breakout, while declining volume during upswings may hint at waning conviction.
Relative Strength Index (RSI)
The 14-day RSI stands at ~72, entering overbought territory. This suggests a high probability of a short-term correction, though the strong trend may delay a meaningful pullback. A drop below 60 would signal reduced momentum, while a close above 75 could indicate a continuation of the rally. Traders should monitor for a "failure swing" (a sharp RSI drop from overbought levels) as a bearish signal.

Fibonacci Retracement
Key Fibonacci levels derived from the Dec 9–10 swing (low $213.50 to high $234.17) include 50% at $223.84, 61.8% at $229.50, and 78.6% at $232.50. The current price is near the 78.6% level, suggesting a potential consolidation phase. A break above $234.17 (100% extension) would target $238.86 (Dec 8 high), while a failure to hold $223.84 could trigger a retest of the 38.2% level at $220.50.
Confluence is strongest at $234.17, where Fibonacci resistance, the upper Bollinger Band, and prior highs converge. A breakout here with expanding volume and MACD confirmation would validate a bullish case. Conversely, a failure to hold $223.84 with divergent RSI and KDJ indicators could signal a trend reversal. Divergences to watch include the MACD narrowing despite rising prices, which may precede a pullback. Probabilistically, the 6.11% move suggests a high-conviction rally, but overbought conditions imply a 60–70% chance of a near-term correction to the 50–61.8% Fibonacci range.