MRVL: Capitulation Rebound Setup—Targeting a 23.6% Gap Retrace Near 66

Comprehensive multi-lens technical review (daily + intraday) and 24-hour trading plan for MRVL

1. Market context and recent price action

• Violent regime shift: On 2025-08-29, MRVL gapped down from 77.23 (8/28 close) to 64.53 (8/29 open), closing 62.87 on extraordinary volume (~96.8M). That’s a −18.6% close-to-close in 1 day and a −16.4% gap at the open—classic event-driven breakaway gap. Such moves often create short-term dislocations with either: (a) capitulation-and-bounce or (b) bear-trend continuation after a brief relief rally.
• Today (2025-09-02) intraday: Opened 61.96, printed 61.81 low early, then steadily reclaimed levels, closing near highs around 64.60 with a session high 64.66. Price progression by hour showed higher highs and higher lows into the close—a constructive “reclaim” day after capitulation.
• Current price 64.6 sits modestly above 8/29 close (62.87), signaling initial mean reversion but still far below pre-gap levels.

2. Gap analysis and mean-reversion tendency

• Breakaway gap magnitude: 77.23 → 62.62 (8/29 low) is 14.61 points. Relief bounces commonly retrace 23.6–38.2% of the gap zone over 1–3 sessions if selling pressure abates.
• Key partial-gap retrace targets (from 62.62 low to 77.23):
  • 23.6%: 62.62 + 0.236*14.61 ≈ 66.1
  • 38.2%: 62.62 + 0.382*14.61 ≈ 68.2
  • 50.0%: ≈ 70.9 Near-term the 23.6% at ~66.1 aligns with nearby resistance clustering—high-probability first magnet in a 24-hour horizon if the bounce persists.

3. Trend and moving averages

• Daily structure: Prior to the gap, MRVL oscillated 71–79 throughout August; short and medium MAs were rolling over late August. After the gap, price is decisively below short/medium MAs (10–20–50D) indicating the intermediate trend is down.
• Short-term (1h) posture: Today’s intraday sequence turned from distribution to accumulation; successive hourly candles built a rising micro-trend, consistent with a “day 1–2 bounce” after an exhaustion gap.
• Takeaway: Daily trend bearish; tactical intraday trend bullish. This combo favors a controlled long for a 1-day bounce into resistance, not a swing-long bet.

4. Momentum indicators

• RSI (daily): Given the collapse, daily RSI is likely in oversold territory (approx mid-20s to low-30s pre-bounce), now improving. Oversold + upward inflection supports a near-term relief rally.
• MACD (daily): Deeply negative and likely under the signal line—bearish overall—but early signs of momentum loss as price stabilizes above 63. The first bullish MACD histogram uptick often follows a strong bounce day like today.
• Stochastics (daily): Likely buried then curling up, reinforcing short-term mean reversion potential.
• Read-through: Momentum still net-bearish on higher timeframe, but short-term oscillators favor an upward push toward first resistance bands.

5. Volatility and Bollinger Bands

• ATR/Range expansion: The post-gap regime features widened ranges (daily > 2–3 points). Elevated ATR supports larger intraday swings and faster tests of nearby levels.
• Bollinger Bands (daily): Price likely pierced or skirted the lower band on 8/29; today’s strong close near highs is consistent with “outside-to-inside” snapbacks. Typical playbook: tag/pierce lower band, then revert toward the 20D mid-band over multiple days; in the first 24 hours, a move toward the lower/mid band zone cap (mid-60s) is common.

6. Volume and participation

• 8/29 volume spike (~96.8M) signals capitulation/liquidity event. Today’s intraday session maintained solid participation with persistent bids into the close, and price finishing above the day’s VWAP region (inferred by late-session strength)—a sign of demand winning the day.
• Volume dynamics favor continuation: Closing near HOD on healthy volume often follows through early next session, at least to challenge nearby supply.

7. Key levels (support/resistance) from recent structure

• Supports: 64.0 (intraday shelf), 63.0 (round + intraday congestion), 62.62 (8/29 swing low), 61.8 (today’s early wash area).
• Resistances: 64.66 (today’s HOD), 65.0 (psych), 65.9–66.3 (confluence zone: prior pivots; near 23.6% retrace ≈66.1), 67.0 (minor round), 68.2 (38.2% retrace and heavier supply).
• Implication: Expect first meaningful sellers 65.9–66.3; a break-and-hold above 66.3 opens 67.0–68.2.

8. Fibonacci mapping (recent leg)

• Using 8/29 low 62.62 to 8/28 close 77.23 as reference:
  • 23.6% ≈ 66.1 (first magnet)
  • 38.2% ≈ 68.2 (secondary if momentum is strong) In the next 24 hours, the 23.6% target is most realistic given residual overhead supply.

9. Intraday microstructure and VWAP behavior (today)

• Session flow: Early weakness → strong midday reclaim → close near highs. This commonly indicates buyers in control into the next open.
• VWAP: Price traded above VWAP from mid-session onward, confirming accumulation. Dips toward 63.9–64.2 are likely to be defended on first touch next session if the bounce thesis persists.

10. Ichimoku view (daily)

• Price well below cloud; Tenkan/Kijun overhead. In bearish regimes, first bounces often stall near the Kijun/flat cloud edges or recent swing equilibrium—roughly consistent with 66–68 test. Signals maintain bigger-picture caution, but do not preclude a tactical 1-day long.

11. Elliott wave framing (tactical)

• Large gap down can mark end of a wave-3 capitulation; today’s session resembles wave-4/B corrective bounce. Wave-4/B often retraces 23.6–38.2% before either rolling over or building a larger base. For 24h, a 23.6% retrace toward ~66.1 is the default expectation.

12. Candlestick diagnostics

• 8/29: large bearish candle, close near low—capitulation.
• 9/02: strong green day that appears to engulf the prior day’s real body (today’s close 64.6 > 8/29 open 64.53) and close near HOD. Bullish-engulfing-like body at a potential exhaustion point is a classic short-term reversal tell.

13. Risk management context

• Volatility is elevated; slippage risk is high around the open. Plan entries via limit on dips into support with pre-defined invalidation.
• If 63 fails decisively, the bounce is likely faltering; below 62.6 (gap low) the bounce thesis breaks and trend-continuation lower becomes the base case.

14. 24-hour scenario map

• Base case (~55%): Continuation bounce to 65.5–66.3, with dips to 63.9–64.2 bought. Close or intraday tag near 66.1 aligns with 23.6% Fib.
• Bullish extension (~25%): Strong opening drive through 66.3 → probe 67.0–67.6; stretch target 68.2 if momentum and broader market risk-on.
• Bearish fade (~20%): Early pop sold at 65–66; loss of 63.9 leads to 63.0 test; break of 63 opens 62.6 retest.

15. Confluence summary → Trading decision

• Bullish factors: Oversold bounce setup (RSI), bullish body engulf after capitulation volume, VWAP reclaim, higher-high/higher-low intraday structure, 23.6% retrace magnet ~66.1, and supportive mean-reversion dynamics after an extreme gap.
• Bearish factors: Dominant daily downtrend and heavy overhead supply; gap remains largely unfilled; MACD still negative; earnings/event headline risk lingering.
• Net: Favor a tactical long for a 1-day rebound into first resistance (66 area) with tight risk controls.

Actionable plan (next 24 hours)

• Bias: Buy dips (Long). Optimal entry via limit in 64.0–64.2 support zone where buyers defended late session. If no dip, a momentum add-on trigger is a break/hold above 65.0, but primary plan prioritizes pullback entry for better R:R.
• Profit target (TP): 66.2 (just above 23.6% retrace ~66.1 and below 66.3 confluence) to capture the high-probability first test without overreaching into heavier supply.
• Invalidation (context, not an order here): Sustained trade below 63.0 would negate the bounce structure and caution against staying long.

Forecast for the next 24 hours

• Expected range: 63.8–66.5
• Directional bias: Upward drift toward 65.5–66.3 with potential early dip to 64.0–64.2 that should be bought if the bounce remains intact.

Note: This is a tactical, short-duration trade idea within a broader downtrend; agility and adherence to risk parameters are essential in a post-gap, high-vol regime.