SPCE: Is there a light at the end of this tunnel?
I think so! at least partially. Based on my previous analysis, and I still think that SPCE will go further down before it goes back up by their next test flight date on May 21st.
That makes the 2nd scenario (blue line) more likely especially since we've been going through a period of consolidation under 200 MA making (bearish trend), and there is a gap to be filled (see the white boxes). This is my 2nd scenario because I don't like to see SPCE breaking under the green trendline and get crushed (temporarily!).
The first scenario is preferable in the short term because it would break out of the head-and-shoulder pattern but then would go to make a double top, which is another bearish signal. In that case, it should break below the green trend line and test the red one down below. This scenario also makes sense because growth stocks like this are under pressure of yields going up to 2% by the summer, and the fact that we are in a bearish market, at least in this sector.
At the end of both scenarios, SPCE should go up before the test flight. That's what has happened in the past, and is expected to happen by May. But the problem is that I don't think it would hit the previous ATH because they've been canceling flights way too often and the management has lost investors' confidence in their stock. Not to mention Chamath has cashed out! But, there is a chance for SPCE to reach ATH and surpass it if the flight is successful or this ticker will fall down into the gutter!
So what to do now? I am going to wait and see where this accumulation (blue MACD box) is taking us. Is it going to break below the green line or it starts to follow the first scenario? In either case, do your own research and don't make any decision based on this analysis. The stock market is unpredictable and whoever says it's not is either an idiot or is lying. I'm not a financial expert and this is not trading advice.
P.S. I've seen people drawing inverted cup and handle patterns and say after the handle is formed this will go up! but... surprise! an inverted cup and handle is a bearish pattern (look it up!) and if the handle is formed, my 1st scenario is confirmed.
Thanks,
That makes the 2nd scenario (blue line) more likely especially since we've been going through a period of consolidation under 200 MA making (bearish trend), and there is a gap to be filled (see the white boxes). This is my 2nd scenario because I don't like to see SPCE breaking under the green trendline and get crushed (temporarily!).
The first scenario is preferable in the short term because it would break out of the head-and-shoulder pattern but then would go to make a double top, which is another bearish signal. In that case, it should break below the green trend line and test the red one down below. This scenario also makes sense because growth stocks like this are under pressure of yields going up to 2% by the summer, and the fact that we are in a bearish market, at least in this sector.
At the end of both scenarios, SPCE should go up before the test flight. That's what has happened in the past, and is expected to happen by May. But the problem is that I don't think it would hit the previous ATH because they've been canceling flights way too often and the management has lost investors' confidence in their stock. Not to mention Chamath has cashed out! But, there is a chance for SPCE to reach ATH and surpass it if the flight is successful or this ticker will fall down into the gutter!
So what to do now? I am going to wait and see where this accumulation (blue MACD box) is taking us. Is it going to break below the green line or it starts to follow the first scenario? In either case, do your own research and don't make any decision based on this analysis. The stock market is unpredictable and whoever says it's not is either an idiot or is lying. I'm not a financial expert and this is not trading advice.
P.S. I've seen people drawing inverted cup and handle patterns and say after the handle is formed this will go up! but... surprise! an inverted cup and handle is a bearish pattern (look it up!) and if the handle is formed, my 1st scenario is confirmed.
Thanks,
Comment:
* 2nd scenario
Comment:
I think I missed the third scenario here and that's if the price goes up to 35, retest 30 and go back to 40ish. When I look back at my analysis I realized that if the price goes back to test the red line, it would most likely be on a down trend and it's hard to imagine for the stock to go up that much after that. But there is the "test-flight effect" Let's see!
Comment:
As stated in my analysis, this should hit 22 and bounce back up. It's nicely following my 2nd scenario!
