Zoom Stock Hovers Near Key Support As Technical Indicators Signal Inflection Point

Zoom Communications (ZM) advanced 0.45% to $79.85 on October 8, 2025, with trading volume of 2.47 million shares. The stock remains range-bound between key technical levels, with several indicators suggesting a potential inflection point.
Candlestick Theory
Recent price action shows consolidation within a $78.91-$82.51 range established since early October. The October 8 session formed a spinning top candle after testing the $80.25 resistance level. Notably, the October 7 hammer candle at $78.91 establishes immediate support, while the September 19 bearish engulfing pattern at $87.17 remains the swing high resistance. This price compression suggests imminent directional resolution.
Moving Average Theory
The 50-day MA ($81.90) has crossed below the 100-day MA ($83.20), confirming a bearish medium-term shift. Current price trades below both short-term averages yet maintains position above the 200-day MA ($77.80), indicating lingering long-term bullish bias. The descending 50/100-day MAs create dynamic resistance near $81.50-$82.00, with clustered moving averages suggesting distribution in this zone.
MACD & KDJ Indicators
MACD (12,26,9) maintains a bearish trajectory below the signal line, though histogram contraction shows diminishing downside momentum. Concurrently, the KDJ oscillator (9,3,3) registers oversold conditions with %K (18) below %D (23). This divergence signals potential bullish reversal fuel, particularly if %K crosses above %D. Both oscillators align in suggesting downside exhaustion near current levels.
Bollinger Bands
Bollinger Bands (20,2) contracted to their narrowest width since July, reflecting historically low volatility. Price currently hugs the lower band near $79.00, which combined with oversold KDJ readings, suggests technical support. Any expansion from this compression would likely dictate the next directional move. A decisive close below $79.00 could trigger accelerated selling.
Volume-Price Relationship
Volume profiles reveal concerning trends: October's pullback occurred on elevated volume versus the September rally. The October 7 sell-off to $78.91 saw 2.64 million shares traded – 12% above average – confirming distribution pressure. Conversely, the October 8 rebound featured below-average volume (2.47M shares), suggesting weak conviction. This volume asymmetry continues to favor bears near resistance zones.
Relative Strength Index (RSI)
The 14-day RSI (34) exited oversold territory after testing 30 on October 7. While this relieves immediate downside pressure, readings remain below neutral (50), reflecting persistent bearish momentum. Historical data shows RSI frequently bottoms near 30 during this correction phase, though recovery attempts consistently failed to breach 55 – reaffirming the downtrend. The indicator's warning nature warrants confirmation from volume or candlestick patterns.
Fibonacci Retracement
Applying Fibonacci levels to the September swing high ($87.17) and October low ($78.91) reveals critical thresholds. The 61.8% retracement at $78.71 aligns precisely with recent intraday lows, forming a technical floor. Current trading sits near the 50% level ($80.54), with overhead resistance at the 38.2% retracement ($82.37). Confluence exists as this resistance zone overlaps with descending MAs around $81.50-$82.00.
Confluence and Divergence Observations
Strong technical confluence emerges at $78.70-$79.00, where the 61.8% Fibonacci retracement, recent swing low, Bollinger Lower Band, and KDJ oversold signals intersect. A breakdown below this support would target the 78.6% retracement ($77.05) and 200-day MA ($77.80). Meanwhile, MACD/RSI bearishness diverges from KDJ's recovery potential – characteristic of transitional phases. Volume patterns and MA positioning currently favor the bearish case, though compressed Bollinger Bands increase reversal probability. Resolution above $80.25 resistance would invalidate immediate downside risks.