Shares of the aerospace name are near the historically bullish 200-day moving average
Shares of
Rocket Lab Corp (NASDAQ:RKLB) are moving 4% higher to trade at $79.80 this afternoon, a brief reprieve from its longer-term drawdown on the charts. The space stock has lost 21% already in July and are 47% off their May 27 all-time high of $150.99.
More gains could be looming, however as the shares are now testing a historically bullish trendline.
According to Schaeffer's Senior Quantitative Analyst Rocky White, RKLB is trading within 0.75 times the 200-day moving average's 20-day average true range (ATR), after spending at least 80% of the previous two weeks and 80% of the prior 42 trading sessions above that trendline.
This setup has appeared five times over the last decade, after which the stock was higher one month later 80% of the time, averaging an impressive 37.1% gain. A similar move from the stock's current perch would put the shares at $109.41.
The aerospace favorite's Schaeffer's Volatility Index (SVI) of 96% stands higher than just 28% of all other readings from the past year. In other words, this implies that near-term option traders are pricing in relatively low volatility expectations.
Plus, RKLB's Schaeffer's Volatility Scorecard (SVS) sits at a high 87 out of 100. This indicates that the stock has tended to exceed option traders' volatility expectations during the past year.