Sony Stock Surges 3.12% on Bullish Technical Signals, Gains 4.34% in Two Days

Sony Group (SONY) has surged 3.12% in the most recent session, extending its upward momentum with a 4.34% gain over two days. This performance suggests short-term bullish momentum, warranting a detailed technical analysis to assess its trajectory and potential risks.

Candlestick Theory

The recent price action forms a two-day bullish pattern, with a long white candle (closing at ¥30.07) following a smaller positive bar. Key support levels are evident at ¥28.55–28.82 (a consolidation zone from late August to early September), while resistance is forming near ¥30.25–30.07. The price has tested and held above the ¥29.16–29.19 range, which previously acted as a psychological barrier. A breakout above ¥30.25 could trigger a retest of the ¥30.70–30.80 area, a prior overhead resistance. Conversely, a failure to sustain above ¥29.16 may reestablish ¥28.55 as a critical support.

Moving Average Theory

The 50-day moving average (approximately ¥28.80–29.00) and 100-day average (¥27.60–27.80) are both ascending, with the 200-day MA (¥25.40–25.60) acting as a long-term floor. The current price (¥30.07) sits above all three, indicating a bullish trend. The 50/100-day crossover in early September has strengthened the uptrend, while the 100/200-day separation suggests no immediate bearish divergence. A pullback to the 50-day MA could offer a high-probability entry, though a close below the 100-day MA would signal weakening momentum.

MACD & KDJ Indicators

The KDJ indicator recently formed a golden cross (K-line crossing above D-line), aligning with the price breakout from ¥29.16. This suggests a short-term buying opportunity, corroborated by the MACD histogram’s positive expansion. The RSI (calculated at ~68–70) indicates overbought conditions, though the price remains supported by rising volume and momentum. A bearish divergence may emerge if the RSI fails to make higher highs while the price does, but this is currently not evident.

Bollinger Bands

Volatility has expanded as the price approached the upper Bollinger Band (¥30.25–30.30), suggesting increased buying pressure. The bands’ width has widened from ~¥1.00 to ~¥1.30 since mid-August, reflecting heightened uncertainty. A close above the upper band may trigger a continuation, while a retest of the middle band (¥29.16–29.20) could act as a pivot.

Volume-Price Relationship

Trading volume has surged on the recent upswing, with the last session’s volume (4.26 million shares) exceeding the 30-day average by ~15%. This validates the price strength and suggests institutional participation. However, a volume contraction on further gains could indicate waning momentum. The volume profile also shows a key accumulation zone between ¥28.50 and ¥29.00, which may provide a cushion for any pullbacks.

Relative Strength Index (RSI)

The RSI has entered overbought territory (~70), a cautionary signal. While this is common in strong trends, it may precede a corrective phase. A decline below 60 without a corresponding price drop would confirm weakening momentum. Conversely, a sustained RSI above 70 would validate the uptrend’s resilience.

Fibonacci Retracement

Applying Fibonacci levels to the ¥24.32–30.25 range, key retracement levels include ¥28.45 (38.2%), ¥28.15 (50%), and ¥27.85 (61.8%). The current price is near the 38.2% retracement, suggesting potential consolidation before a resumption of the uptrend. A breakdown below ¥28.15 would target ¥27.85 as the next support, with the 50% level acting as a pivot.

Backtest Hypothesis

The backtest strategy of buying SONY on a KDJ golden cross and holding for 10 days yielded a 53.30% return, outperforming the benchmark by 11.94%. This aligns with the recent golden cross observed in mid-September, which coincided with the price breakout from ¥29.16. The strategy’s Sharpe ratio of 0.75 and zero maximum drawdown suggest it thrives in trending environments, particularly when volume and moving averages confirm the signal. However, its 16.65% volatility implies it may struggle in range-bound conditions, as seen in late July to mid-August when the RSI oscillated between 40 and 60. Integrating Fibonacci retracements could refine entry points, as the 38.2% level has historically acted as a filter for false breakouts.