CoreWeave Plummets Amid Acquisition Jitters—What’s Next for AI Infrastructure Leader?

• CRWV slumps 9.6% to $130.98, erasing $9B+ valuation in a single session
• Needham downgrades rating to HOLD, citing valuation risks from Core Scientific deal
• $9B all-stock acquisition of Core Scientific triggers investor caution despite synergies
• Intraday range spans $128.61–$136.36, with 52W high at $187 and 52W low at $33.52

CoreWeave’s abrupt selloff marks a pivotal moment for the AI infrastructure giant, as investors weigh the risks of aggressive growth against execution uncertainty. The stock’s 9.6% plunge contrasts sharply with a flat Nasdaq, underscoring sector-specific concerns.

Needham Downgrade and $9B Acquisition Drive CoreWeave’s Selloff
CoreWeave’s stock collapse stems directly from two catalysts: Needham’s downgrade and investor skepticism toward its $9 billion acquisition of Core Scientific. Needham analysts flagged valuation concerns, noting the all-stock deal’s dilution impact amid CRWV’s recent quadruple-digit rally since its April IPO. Meanwhile, the Core Scientific buy—though strategically sound for power capacity expansion—has raised red flags about overpayment risks and execution complexity. The combined entity’s 1.3 GW data center footprint and 1 GW future power contracts, while critical for AI scaling, face near-term dilution and regulatory scrutiny, amplifying near-term volatility.

Data Center Sector Faces Climate Risks—CoreWeave’s Slide Outpaces Peers
The broader data center sector shows resilience despite climate-related headwinds, with sector leader Equinix (EQIX) down just 0.68%. While Verisk Maplecroft warns of rising heatwave risks to global data centers, peers like Google and Amazon continue expanding capacity. CoreWeave’s 9.6% drop contrasts with sector stability, reflecting unique risks tied to its acquisition strategy rather than systemic industry pressures.

Bearish Technicals and Top Options for CoreWeave’s Volatile Crossroads
Technical Indicators:
• RSI: 34 (deeply oversold)
• MACD: -5.46 (bearish crossover confirmed)
• Bollinger Bands: Below middle band ($159.61)
• 30D MA: $151.71 (current price below support)

A short-term bearish trend dominates CRWV’s technicals, with RSI in oversold territory suggesting a potential rebound. However, resistance at $136.36 (intraday high) and the $137.83 Bollinger lower band form critical ceilings. Aggressive traders should focus on downside plays.

Top Picks:
1. CRWV20250718P125 (Put Option):
• Strike: $125 | Expiration: July 18
• Implied Volatility: 98.96% | Leverage: 25.92%
• Delta: -0.357 | Gamma: 0.0195 | Theta: -0.165
• Rationale: High turnover ($900k) and delta exposure make this a liquidity-rich play for further declines. A 5% downside to $124.43 would yield a $0.57 profit per contract.

2. CRWV20250718P122 (Put Option):
• Strike: $122 | Expiration: July 18
• Implied Volatility: 99.00% | Leverage: 33.51%
• Delta: -0.297 | Gamma: 0.0181 | Theta: -0.182
• Rationale: Extreme volatility and high gamma amplify gains if CRWV breaches $125 support. A $120 price would trigger a $2 payoff per contract, offering asymmetric risk/reward.

Hook: “Bearish momentum favors P125 and P122 puts—target $128 breakdown for confirmation.”

Backtest CoreWeave Stock Performance
The iPath S&P 500 VIX Short-Term Futures ETN (CRWV) has historically shown strong recovery performance following a -5% intraday plunge. The backtest data reveals favorable win rates and returns across various time frames, indicating that CRWV tends to rebound significantly after such events:1. Frequency and Win Rates: The event occurred 33 times over the backtested period. The 3-day win rate was 57.58%, the 10-day win rate was 60.61%, and the 30-day win rate was 66.67%. This suggests that CRWV has a higher probability of a positive return in the short term following a sharp decline.2. Returns: The average 3-day return was 8.21%, the 10-day return was 19.73%, and the 30-day return was 68.97%. These figures indicate that CRWV can deliver substantial gains in the days following a -5% intraday plunge.3. Maximum Return: The maximum return during the backtest period was 74.62%, which occurred on day 35. This highlights the potential for CRWV to experience significant appreciation in the aftermath of a sharp decline.In conclusion, the historical performance of CRWV following a -5% intraday plunge is positive, with a high likelihood of a rebound over the short term. Investors considering CRWV as a potential investment should be mindful of its volatility and the possibility of significant drawdowns, but also recognize the potential for substantial gains in the days following such events.

CoreWeave’s Crossroads: Acquisitions and Valuation Concerns Define Next Move
CoreWeave’s valuation reckoning is far from over. While the Core Scientific deal offers long-term power capacity advantages, near-term dilution and execution risks keep bears in control. Investors must monitor the $128 support level—failure here could trigger a deeper selloff toward $122. Equinix’s muted -0.68% dip highlights sector resilience, but CRWave’s aggressive growth profile sets it apart. Traders should prioritize downside options and watch for Q4 acquisition closure clarity. The verdict? This isn’t just a correction—it’s a pivotal test of investor confidence in AI infrastructure’s next-gen bets. Action Alert: Watch $128 breakdown and EQIX’s 30D MA ($151.71) for cross-sector signals.