Technical Analysis on Adobe Inc. (ADBE) – Bullish Strategy

📊 Technical Analysis on Adobe Inc. (ADBE) – Bullish Strategy
🔍 Context and Price Structure
After a strong bullish impulse, the stock entered a distribution phase that culminated in a double top (Top 1 & Top 2), which triggered a medium-term downtrend.
The decline formed a Falling Wedge pattern, typically considered a bullish continuation structure, with the initial target partially achieved.
Subsequently, ADBE found solid support around the $340–345 area, where a double bottom (Bottom 1 & Bottom 2) was established. This is one of the most reliable reversal patterns, especially when confirmed by higher volumes and a neckline breakout.
📈 Current Pattern and Projections
The double bottom around $340–345 has created a technical base projecting an initial target toward the $420 zone, aligning with prior static resistance.
A decisive breakout above $420 with strong volumes could open the way for an extended move toward $500–520, consistent with the relative highs from the 2023 distribution phase.
Bollinger Bands are narrowing, signaling a volatility squeeze, often a precursor to a strong directional move.
📊 Momentum Indicators
The RSI is confirming bullish signals: after dipping into oversold territory near 30, it formed a bullish divergence and is now recovering above its moving average. This indicates improving relative strength.
The short-term EMA is flattening and could cross above longer-term averages if price breaks above the $380–385 area, reinforcing the reversal signal.
📊 Volume Dynamics
Recent sessions show increasing volume on rebounds, suggesting that institutional investors may be accumulating.
The $340 support zone has been defended decisively, with each retest being rejected, strengthening the validity of the double bottom.
🎯 Targets & Risk Management
First bullish target: $420 (double bottom neckline).
Extended target: $500–520 (previous highs + technical projection).
Key support: $340 – a breakdown below this level would invalidate the bullish setup and re-expose downside risk toward $300.
Suggested approach: gradual entries, with confirmation above $380–385 on rising volume; technical stop-loss below $340.
✅ Conclusion
Adobe is at a potentially decisive stage: the formation of a double bottom at key levels, the breakout from a falling wedge, volatility contraction, and bullish RSI signals together outline a favorable medium-term reversal scenario. A breakout above $380–385 could pave the way for a rally toward $420 and then $500–520, offering an attractive risk/reward ratio for long positions.