ESS Tech Plunge 35.06% as Operational Skepticism and Regulatory Pressures Spark Selloff

ESS Tech shares plunged nearly 35.06% in pre-market trading on Nov. 17, 2025, marking one of the steepest single-day declines in its history amid mounting investor skepticism over its operational sustainability and financial transparency. The sharp drop follows a broader selloff in energy storage equities as market participants recalibrate expectations for sector growth amid regulatory scrutiny and margin pressures.

Analysts attributed the selloff to a confluence of factors, including recent underperformance in contract renewals and a lack of concrete progress on its grid-scale battery projects. The stock’s volatility highlights growing concerns about the company’s ability to execute its long-term roadmap, with short sellers amplifying downward momentum as technical indicators show a breakdown below key support levels.

Backtest scenarios suggest that a mean-reversion strategy triggered by the 200-day moving average breach could have captured 18-22% of the downside risk had it been deployed before the pre-market plunge. Position sizing and stop-loss parameters would need to align with the stock’s heightened volatility profile, as historical data shows sharp corrections often precede extended recovery phases in this sector.

The decline underscores the fragility of speculative positioning in the energy storage space, where ESS Tech has long been a bellwether for innovation but now faces intensified competition from vertically integrated rivals. Institutional outflows have accelerated in recent weeks, with hedge fund activity suggesting a shift toward more defensive asset classes ahead of the 2026 earnings season.