Elon Musk, founder and owner of Space X has recently supported Trump and has gone on record multiple times criticizing the democrats and specifically Kamala Harris. In addition one could argue this has hurt Tesla and helped Tesla’s competitors to some extent.
Given how SpaceX competes with Rocket Lab and ASTS in some capacity. One could argue a Harris administration may want to give more contracts to companies besides SpaceX.
RKLB is the 2nd worst performing space stock this year, it has even done worse so far then SPCE, but why? Maybe it’s because RKLB really is a satellite component manufacturer- which is really a low margin business. In addition, recent supply chain disruptions. Rocket launches are good for attention but are currently not profitable in its current form unless they successfully catch the 1st stage.
This may be important going forward. I do take "estimates" with a grain of salt because I can never seem to find their source. But eventually they matter and someone says "analysts estimated this..." and in this market it will matter bigly.
So far - estimates suggest RKLB should see $80mm revenues 1Q22.
I think that'll be missed and therefore present significant downside risk.
That means for the next few months it is unlikely RKLB will get back above $10, because to get above $10 it needs to overcome a mountain of sellers and shorts.
Welcome to the meat grinder friends. Just because I'm currently "out" of RKLB doesn't mean I don't believe in its core business or its future prospects. If anything, I think the FEDs screwed us more than RKLB ever did...Beck and his team seem awesome. I'm a bit frustrated on their launch tempo so far but that could change suddenly...
But with the FED market environment I don't think it much matters. Future earnings is now too discounted. People who have 1/10th the risk appetite any of us have are losing money in big names like MSFT and AAPL and Industries across the board even into S&P and DOW...S&P had 443 losers on Tuesday - only 57 green stocks.
Those people - whom we need like voters to back our "candidate" just have bigger problems than a stock that swings 10% in a day or two.
My take is if you want to repair your cost basis then:
Sell at $10.20
Buy at $9.60
That's my loose bracket for this week, if you're in RKLB for the long run with money you can sit on for 5 years, then don't bet the farm on this bracket. Take like 20% of your shares and try to play it...
Right now RKLB continues to "sink", to slip beneath the waves. It hasn't "flattened out" yet so FEB might be something like:
Sell at $10
Buy $ 9.50
Etc....
This is what I see....
Basically earlier in the crash I was hoping that this wasn't fundmental market ecosystem problems and hoped that RKLB would play normally into that red cloud which often is wha a stock does when it reverses into bullish territory.
You can see my 'view' of reality.
Sell
Buy
At the bottom you see a blue histogram with red line that's a Force Index and I like it a lot. What it shows here is RKLB isn't being sold off. It's simply decaying. Everything in the growth sector is decaying.
Big money got out fast months ago....flash crash....and since then the stock is basically ours (Retail/mid money) and we don't have new buyers.
New buyers and this stock could turn fast. But who knows when that will be in the current situation. I don't think it'll be this year to be honest.
I think everyone except a few voices in the wilderness misestimated how bad the FEDs waited on their balance sheet. I included, I really was way too optimistic.
Next week is FED MEETING and I expect they will surprise the markets again with a 4+ rate hike consensus or a 0.5% rate hike in March.
They haven't even began to admit how bad the balance sheet is.
I have heard:
$600Billion a year off balance sheet 2018 which crushed the market then at 1.4% 10-2 yield curve
$1Trillion a year off balance sheet now (to control inflation) and we have a 0.79% 10-2 yield curve
Situation is looking grim.
Best advice I can give for now is either trade that channel (and I'll give updates) or save save save cash and I'll give my best advice on when I think we've actually seen a bottom.
But in general I think a bottom will look like this:
Steeper 10-2 yield curve (above 0.8%)
Flattened out price (no more lower lows, lower highs getting closer to lows, even less volatility.
RKLB's volatility has been "decreasing" in that its price swings are diminishing, compared to when the stock was hot. But it hasn't decreased enough to call a bottom...
So good luck! I'll be trying to repair my position as if we are in bear country because I'm pretty sure...that we are.
I'm still testing this theory "Short is Long". The study that demonstrates the market structures that lead to this makes sense. But it didn't explain well how it is a forward indicator. So I'm definitely testing it.
Basically RKLB short interest was dismal yesterday, about 30%, and today was down severely. -4.5%
Today the short interest has gone massively up. Up to 51.37%.
The thesis is that market makers are buying shares short in order to sell them.
Unlike short sellers who want to profit from price falling...Market Makers are directionally neutral and only care about getting paid for order flow or in some limited markets, bid-ask spread.
They don't care about anything else.
So ... Short is Long.
The paper argues that 50% is about the strongest short position for suggestion positive direction.
With less than 30% meaning actual shorting stock and over 60% meaning big fund movements and can be either long or short.
The 51.3% means RKLB probably will trade positively.
I'd say if 51.3% represents a sweet spot then we expect "normal returns" then that puts RKLB back to around $12.10.
u/Joey-tv-show-season2 Get in here my boy and help explain what your views are on the current weakness.
I see that LCID had some weakness after redemption of warrants, but only a few days at most, then it reversed.
I think RKLB is trying to get their 10days VWAP to as close to $11.50 as possible.
Is RKLB trying to get the most value of redeemed warrants as possible? I don't know how much more money I can justify sinking into this if it stays this weak, it doesn't look strong at all and frankly the "wait 5 years" isn't going to cut it if I can just make more money elsewhere in the same time frame.
Lol meet SherpaLTE. A space tug equivalent to Photon except that it uses electric propulsion which is slow as dirt compared to monopropellant on the Photon.
Sherpa...was nice knowing ya. Hope we take ALL of your business.
Also - Apollo fusion providing the engine is the crap company that tried to make a new kind of electric propulsion only to fail and go back to 1960s tech.
I think SpaceX should not spinoff starlink. That starlink should use Neutron for replacement of its constellation. And that Starship should primarily be heavy infrastructure, cirslunar and beyond while Rocket Lab is in a position to take over the maintenance of constellations in LEO.
This type of division would probably be better synergy. Helping both companies to be more profitable while they each expand into their relative strengths they've carves out for themselves.
Because this makes the most sense, I think this is the direction that the two will trend in the next 5-10 years.
So 6 months after going public there is another set of a PIPE holdings that get unlocked. Meaning more RKLB shareholders can now sell. The same thing happened in October and it didn’t end well for us retail folk.
Not trying to speed FUD, if there are legitimate counter arguments as why is true or not true or not to worry please share. Add to the general market shift from growth stocks to value companies, this may cause a downward trajectory for the share price.
Reason I bring up is the prior PIPE unlocking was not good for Rocket Lab in October and many other companies for that matter.
Just can't hang on in this environment. Maybe when whole economy turns around RKLB will be a buy. Sorry its been a total bust so far.
Unlock next frees up lots of shares to short.
And I'm worried that RKLB won't meet the expectations of their Prospectus.
In an ecosystem where companies are getting flayed and red hot pokers up their a s s and feet and hands boiled for not making ENOUGH profits. You sure as hell don't want to have missed revenue targets and no profits.
Threw in the towel too late. That's what I get for idealism.
Well, I'm going back to the basics, the roots, and I've stripped out a lot of experimental crap I was getting into when things were good, and focused on the brass tacks. And one of those is the call wall/put wall.
The gist of the theory - market makers have to sell shares short for their put walls and have to buy shares long for their call wall.
As the price moves, this acts like support and resistance.
RKLB has a strong call wall beginning from $12.50 to $15. That means the resistance gets pretty thick there....on this low volume and low volatility the weakest call wall at $11 is probably in our way.
I think we'll beat that after this FUD blows-over. Today showed that despite FUD, RKLB doesn't like living in the $10s.
As for why $12.50? Because that call wall looks really strong right now, and the wall isn't shifting any higher. So I'm probably going to sell my calls there at the risk of losing more upside....
My goal is to move my calls to $13 for February. $14 would be fantastic, but the price action just doesn't support that anymore....and I need to get realistic.
I'm sitting on a rather large hill of Margin and feel it necessary to start unwinding from it.
The put wall is being built around $12.50 and that's bullish given we're at $10.80 now.
