There were warnings of this development, even before shares turned lower on the day.
Lucid Motors was trading notably higher in the premarket. However, as we got closer to the open, those gains began to fade considerably.
When the stock market finally opened, Lucid Motor stock was barely higher on the day and it quickly turned lower.
This morning, one of our Real Money contributors wrote that the “reward may not be worth the risk” with Lucid Motors.
Does that mean Lucid’s run is over?
Trading Lucid Motors Stock
Coming into the day, I was on guard for a reversal. That’s mostly as the stock was fading so hard from its premarket highs and after such a monumental run in the stock.
The run is not necessarily done for this one, either.
Shares could find support — be it down at the 10-day moving average or sooner even — and make another push up toward the $60 to $65 area.
That’s where the stock topped out earlier this year and it would allow its market cap to clear $100 billion.
Is that ridiculous? Yes, very. But one could argue its current valuation is also insane and yet here we are.
With the gap above Tuesday’s high at $55.86 and the stock's failure to hold it, we had a reversal in play, which led to a quick flush lower.
From here, we need to see when and where Lucid Motors stock finds its footing. Is it near $48? Is the 10-day moving average? How about the 21-day?
With something this hot, we mostly just need to let it show the way. Predicting isn’t easy to do with the stock market, let alone for something like this.
For now, we’ll see if today’s low holds. Below the low opens Lucid Motors stock up to some more selling pressure.
On the upside, a move back above the $56 level could put the highs in play at $57.75. Above that and bulls have to be thinking about the $60 to $65 area.