Toyota Stock Jumps 3.94% as Technicals Signal Bullish Reversal

Toyota Motor (TM) advanced 3.94% during the most recent session to close at $188.64, rebounding strongly from the prior session's dip. The following technical analysis evaluates the stock's potential trajectory using multiple frameworks.
Candlestick Theory
The recent price action reveals a bullish reversal pattern as the August 8th candle (3.94% gain) fully engulfed the prior day’s bearish candle (-1.36%), signaling potential exhaustion of the short-term downtrend. Key support is established at $180.54 (August 7th low), aligning with the psychological $180 level. Resistance emerges near $193.00, anchored to the July 24th peak, with secondary resistance at the year-to-date high of $200.99. The formation of a higher low at $180.54 followed by a decisive up-move enhances the credibility of the $180–$181 zone as critical support.
Moving Average Theory
The 50-day moving average (~$185) recently crossed below the 100-day MA (~$183), suggesting near-term bearish momentum, yet both remain above the rising 200-day MA (~$178), preserving the structural uptrend. The August 8th close at $188.64 reclaimed the 50-day MA, potentially thwarting a bearish crossover. Sustained trade above the 50-day MA would reinforce bullish control, while failure could reactivate selling pressure toward the 100-day MA support. The 200-day MA’s upward slope underscores the secular bull trend.
MACD & KDJ Indicators
The MACD histogram is recovering from negative territory, with the signal line flattening near oversold conditions—a potential precursor to bullish momentum. Concurrently, the KDJ indicator’s %K line (current value ~93) has surged above the %D line after both dipped below 30 in early August, reflecting a sharp reversal from oversold territory. While this swift ascent risks overextension, the MACD-KDJ convergence suggests strengthening upside momentum that may propel prices toward resistance levels.
Bollinger Bands
A volatility expansion emerged as price rebounded from the lower Bollinger Band ($178) toward the upper band ($190), compressing the bands after a contraction phase. The August 8th close near the upper band indicates bullish strength, though it approaches statistical overbought conditions. A sustained break above $189.23 (upper band proximity) could trigger a volatility-driven rally, whereas reversion toward the 20-day SMA ($185) might signal consolidation.
Volume-Price Relationship
Robust volume of 506,818 shares on August 8th—20% above the 30-day average—validates the bullish breakout. Notably, the July 23rd surge (13.64% gain) recorded the highest volume in the dataset (1.92M shares), confirming critical resistance at $193.00. Conversely, the August 7th decline occurred on below-average volume, weakening the bearish case. Volume consistency during advances supports trend sustainability, though diminishing volume near $193 resistance could foreshadow reversals.
Relative Strength Index (RSI)
The 14-day RSI has rebounded from near-oversold levels (32.6 on August 7th) to approximately 62.1, reflecting recovering momentum. While not yet overbought (>70), its trajectory aligns with the price rebound. Historical divergences warrant caution: the RSI failed to confirm the July 24th high ($193.26), preceding a 6.6% correction. Current readings suggest room for upside before technical exhaustion.
Fibonacci Retracement
Applying Fibonacci to the corrective leg from the July 24th high ($193.26) to the August 7th low ($180.54) reveals key levels. The 50% retracement ($186.90) was breached decisively on August 8th, and the close above the 61.8% level ($188.40) signals bullish conviction. This breaches half the retracement range (50%-61.8%), opening a path toward the 78.6% retracement ($190.53). Confluence exists between the 78.6% Fib and the July 31st swing high ($190.79), making $190.50–$190.80 a tactical resistance zone.
Confluence points are evident at the $188.40–$188.64 region (Fibonacci 61.8% + recent close), which now acts as pivotal support. Multiple indicators agree on bullish momentum: MACD recovery, KDJ reversal from oversold, volume-backed breakout, and Fibonacci breach. Key divergences include the KDJ’s near-overbought %K versus the RSI’s neutral reading, and the MACD’s lag versus the sharp price rebound. The technical posture leans bullish near-term, targeting $190.50–$193.00, though sustainability requires holding the $188.40 Fibonacci support.