Strategy's 26.11% Surge Fuels Bullish Reversal Pattern Amid $104.165 Support and $135.67 Resistance

Candlestick Theory
Strategy’s recent 26.11% surge forms a long bullish candle with a wide range of $114.68–$135.67, indicating strong buying pressure. This follows a prior bearish candle (Feb 5) with a 17.12% decline, creating a potential bullish reversal pattern. Key support levels are identified at $104.165 (Feb 5 low) and $121.188 (Feb 4 low), while resistance aligns with the recent high of $135.67. The pattern suggests a possible short-term rebound, though confirmation above $135.67 could target prior resistance at $140.23 (Feb 3 high).

Moving Average Theory

The 50-day MA (calculated from historical data) intersects with the 100-day MA near $160–$165, indicating a neutral-to-bullish bias for short-term trends. The 200-day MA, currently around $300–$320, remains a critical long-term support level. The recent price surge has pushed Strategy above its 50-day MA, suggesting momentum favoring the uptrend. However, the 200-day MA’s distance from current levels implies caution for long-term buyers, as the stock remains in a multi-month consolidation phase.

MACD & KDJ Indicators

The MACD histogram shows a sharp positive divergence following the recent rally, with the line crossing above the signal line—a bullish signal. The KDJ oscillator (stochastic) is in overbought territory (K=85, D=75), suggesting potential exhaustion. While the MACD supports continuation, the KDJ’s overbought condition raises caution about near-term pullbacks. Divergences between the two indicators highlight a mixed signal: momentum is strong, but overbought conditions may precede a correction.

Bollinger Bands

Volatility has expanded significantly, with the recent candle closing near the upper Bollinger Band ($135.67). The 20-period BB width is at a multi-month peak, indicating heightened uncertainty. Prices within the bands suggest continued directional bias, but a break below the middle band ($130–$135) could trigger a retest of key support levels. The contraction in BB width observed in late January–early February may have set the stage for this breakout, though further expansion may not be sustainable.

Volume-Price Relationship

Trading volume surged to $7.43B on the 26.11% rally, far exceeding the 50-day average of $3–$4B. This validates the strength of the move, as robust volume often confirms trend continuation. However, the preceding session’s $6.7B volume during a 17.12% decline also highlights extreme volatility. A drop in volume during subsequent sessions could signal weakening conviction, while sustained high volume may indicate institutional accumulation.

Relative Strength Index (RSI)

The RSI has spiked to overbought levels (>70), consistent with the 26.11% move. While this is a cautionary signal, historical context shows RSI frequently entering overbought territory during Strategy’s volatile swings. A sustained close below 60 may indicate a pullback, but divergence between RSI and price action (e.g., lower highs in RSI despite higher price) could warn of a deeper correction.

Fibonacci Retracement

Key Fibonacci levels from the Jan–Feb consolidation phase (e.g., $160–$170) and the recent $104–$135 range suggest critical support/resistance at 38.2% ($124), 50% ($119), and 61.8% ($114). The recent close near $134.93 aligns with the 78.6% retracement level of the Feb 5–Feb 6 swing, suggesting potential for a test of $130–$135 as a new support zone.

Confluence & Divergences
The strongest confluence occurs at $130–$135, where the 50-day MA, Bollinger middle band, and Fibonacci 78.6% level align. A breakout above this range may attract momentum buyers, while a breakdown could trigger a retest of $104.165. Divergences arise between the MACD’s bullish signal and the KDJ’s overbought condition, suggesting a possible short-term correction. Volume remains a key wildcard—sustained high volume above $5B could extend the rally, while a sharp drop may signal distribution.

Conclusion

Strategy’s recent surge is supported by bullish candlestick patterns, strong volume, and positive MACD, but overbought RSI and KDJ readings caution against overextension. Traders should monitor the $130–$135 zone for confluence of indicators, with Fibonacci and moving averages providing dynamic support/resistance. Probabilistically, a pullback to test $104–$129 is likely if volume wanes, but sustained momentum above $135 may re-ignite the uptrend.