Rocket Lab Plunges 11.72% Amid Bearish Technical Breakdown

Rocket Lab (RKLB) concluded its latest session at $43.53, marking a significant 11.72% daily decline. This sharp downturn follows a volatile price history, with a 52-week range spanning $5.81 to $53.44.
Candlestick Theory
Recent sessions display a concerning bearish engulfing pattern culminating on September 3. This long-bodied red candle (open: $50.90, close: $43.53) erased gains from the preceding three sessions, signaling strong selling pressure. Key support now emerges near the June 2025 swing low of $38.60, while resistance is evident at the August 25 high of $49.59. The price rejected the psychological $50 threshold twice in late August, reinforcing it as a critical resistance zone.
Moving Average Theory
The death cross materialized in mid-August as the 50-day SMA ($45.80) pierced below the 100-day SMA ($47.20). Both remain beneath the ascending 200-day SMA ($32.50), confirming a deteriorating long-term trend. The latest close ($43.53) sits below all three averages, indicating sustained bearish momentum. A sustained recovery would require reconquering the 50-day average.
MACD & KDJ Indicators
The MACD histogram remains entrenched in negative territory (-2.50), with both signal and MACD lines accelerating southward. This corroborates strengthening downward momentum. Simultaneously, the KDJ oscillator (K: 18, D: 25, J: 4) resides deeply in oversold territory. While this suggests potential exhaustion, bearish crossovers persist, and no bullish divergences are apparent relative to price.
Bollinger Bands
Volatility expanded markedly during the September 3 sell-off, with price breaking below the lower band ($46.30). This deviation often precedes mean-reversion bounces, but the accompanying high volume implies institutional distribution. Bandwidth surged to 120% of its 20-day average, reflecting elevated panic selling. A consolidation phase near $42–$44 would be typical before directional resolution.
Volume-Price Relationship
The breakdown candle featured the highest volume (33M shares) since July 21, validating bearish conviction. Notably, August 26 recorded similarly heavy volume (47.7M shares) during a failed breakout above $50. This distribution pattern—elevated volume on down days—confirms institutional exit. Sustained recovery would necessitate accumulation patterns with volume confirmation.
Relative Strength Index (RSI)
The 14-day RSI (26.7) plunged into oversold territory, its lowest reading since March 2025. Historically, readings below 30 have coincided with tactical rebounds. However, the absence of bullish divergence (price lows undercut RSI lows) tempers reversal expectations. This reading warrants vigilance for oversold bounces but lacks standalone predictive reliability amid strong trends.
Fibonacci Retracement
Applying Fib levels to the primary uptrend from $5.81 (Sep 2024) to $53.44 (Jul 2025), the 23.6% retracement at $42.20 provided intraday support on September 3. A decisive close below would target the 38.2% level at $35.25. For the secondary leg up from $38.60 (Jul 2025) to $53.44, the 78.6% retracement ($42.50) aligns with recent lows, creating a technical confluence zone at $42.20–$42.50.
Confluence & Divergence Observations
Clear confluence exists around $42.20–$42.50, where Fib support, the psychological $42 level, and oversold oscillators converge. However, bearish alignment dominates: volume confirms breakdowns, moving averages stack negatively, and MACD shows no reversal signs. A critical divergence emerges between price (new correction lows) and long-term momentum—the 200-day SMA still slopes upward, suggesting this may be a correction within a broader uptrend. Traders should monitor $42.20 for potential reversal patterns, but the weight of evidence currently favors bearish continuation toward $38.60 absent fundamental catalysts.