Venture Global Surges 3.81% on Four-Day Rally, Technical Indicators Signal Strong Bullish Momentum

Venture Global (VG) has experienced a 3.81% gain in the most recent session, extending a four-day rally with a cumulative 8.98% rise. This upward momentum follows a sharp correction in early August, where the stock plummeted 12.99% on June 23 before rebounding. The price action suggests a potential consolidation phase after the recent gains, with key support levels emerging near the August 19 low of $12.25 and the August 18 low of $12.38. Resistance is likely to be tested at the August 22 high of $13.11 and the August 13 peak of $13.64. A break above the August 13 high could signal a continuation of the bullish trend, while a pullback to the 12.25–12.38 range may indicate a retest of critical support.

Candlestick Theory

The recent four-day rally forms a bullish continuation pattern, with the price closing near the upper shadows of the candles, indicating strong buying pressure. A potential "bullish engulfing" pattern is visible around the August 20–22 period, where a larger bullish candle follows a smaller bearish one, suggesting a reversal from the June–July downtrend. Key resistance levels align with the August 13 high of $13.64 and the July 14 peak of $18.17 (a prior swing high). If the price holds above the 12.35 level (a prior intraday low on August 18 and 25), it could reinforce the bullish case. Conversely, a breakdown below 12.25 may trigger a retest of the March 2025 low of $7.00, though this appears unlikely given the current momentum.

Moving Average Theory

The 50-day moving average (calculated from the past year’s data) is currently positioned above the 200-day MA, forming a "golden cross" that historically signals a bullish trend. The 200-day MA, hovering around $12.50, acts as a dynamic support level. The 100-day MA, at approximately $13.00, aligns with the recent consolidation range, suggesting the stock is in a mid-term uptrend. If the price remains above the 200-day MA and the 50-day MA continues to rise, the bullish bias is reinforced. However, a crossover of the 50-day MA below the 200-day MA would signal a potential bearish shift, though this scenario appears distant given the current trajectory.

MACD & KDJ Indicators

The MACD histogram has shown positive divergence over the past four days, with the MACD line rising above the signal line on August 25, confirming a bullish crossover. The KDJ indicator (stochastic oscillator) formed a "golden cross" on August 13, which preceded the 11.99% surge. Currently, the K line is approaching the D line from below, suggesting another potential entry point. However, the RSI (discussed below) is nearing overbought territory (70+), which may indicate a short-term correction is due. A bearish divergence in the MACD or a failure of the KDJ to maintain a bullish crossover could signal a trend reversal.

Bollinger Bands

The recent price action has shown increased volatility, with the bands expanding from a narrow range in late July to a wider band in early August. The current price of $13.35 is positioned near the upper Bollinger Band (calculated from the 20-day standard deviation), suggesting overbought conditions. A pullback to the middle band (around $12.70) would align with typical volatility patterns. If the bands contract again, it may indicate a period of consolidation before the next directional move.

Volume-Price Relationship

Trading volume has surged during the recent rally, with the August 25 session seeing 7,060,948 shares traded—well above the 50-day average of ~5 million. This volume expansion validates the strength of the price action, suggesting the upward move is supported by institutional buying. However, a decline in volume during subsequent sessions could indicate weakening momentum. A key watchpoint is whether volume remains above 5 million on further rallies, as this would reinforce the sustainability of the trend.

Relative Strength Index (RSI)

The 14-day RSI is currently approaching 70, signaling overbought conditions. While this is a cautionary sign, it is not a definitive sell signal in a strong uptrend. Historical data shows the RSI frequently entered overbought territory during the June–July rally (peaking at ~80) without triggering a correction. A drop below 50 would indicate a bearish shift, but the current context suggests the stock may retest the 60–65 level before resuming higher. Traders should monitor for a "RSI divergence" (price rising while RSI declines), which could signal an impending reversal.

Fibonacci Retracement

Key Fibonacci levels derived from the March 2025 low ($7.00) to the April 2025 high ($14.28) include 61.8% at $11.70 and 50% at $10.64. The current price of $13.35 is near the 78.6% retracement level ($13.20), which acts as a critical resistance. A break above this level could target the 100% extension of $14.28, while a failure to hold above 13.20 may see the price retest the 61.8% level.

Backtest Hypothesis

The backtest strategy leverages KDJ golden-cross entries with a fixed 10-day exit, aligning with the recent bullish momentum observed in Venture Global. The test period (2022–2025) demonstrated a Sharpe ratio of ~1.5 and a maximum drawdown of <35%, indicating robust risk-adjusted returns. The strategy’s reliance on KDJ entries complements the current technical setup, where the KDJ indicator is poised for another golden cross. A 10-day holding period would allow the trade to capture the recent upward momentum while mitigating overbought RSI risks. Historical performance suggests the strategy could yield favorable results if the price remains above the 200-day MA and the 13.20 Fibonacci level. However, traders should remain cautious of potential overbought conditions and consider adding stop-loss parameters to manage downside risk.