CoreWeave's CRWV Plummets 4.27%: Merger Meltdown or AI Gold Rush?

Summary
• CoreWeave (CRWV) terminates $9B Core Scientific merger, triggering sharp intraday decline to $133.95
• $14.2B Meta AI contract and analyst upgrades clash with proxy advisor opposition
• Intraday range of $130.41–$137.17 highlights volatile trading amid strategic uncertainty

CoreWeave’s stock faces a pivotal crossroads as the termination of its $9 billion merger with Core Scientific (CORZ) sends shares plunging 4.27% intraday. Despite a $14.2 billion AI infrastructure deal with Meta and bullish analyst ratings, shareholder resistance and regulatory scrutiny cloud the path forward. With the stock trading near its 52-week low of $33.52, investors must weigh short-term volatility against long-term AI infrastructure potential.

Merger Collapse and Proxy War Spark Sell-Off
CoreWeave’s 4.27% intraday drop stems from the abrupt termination of its $9 billion all-stock merger with Core Scientific, a deal already facing fierce shareholder opposition. Proxy advisors Institutional Shareholder Services (ISS) and Glass Lewis recommended against the transaction, citing undervaluation risks and standalone execution challenges. CoreWeave CEO Michael Intrator’s refusal to sweeten the offer—despite no competing bidders—has intensified shareholder skepticism. Meanwhile, the $14.2 billion Meta contract, while bullish, has yet to offset the merger’s collapse, as investors question the company’s ability to execute standalone growth strategies.

Options Playbook: Capitalizing on Volatility and Gamma Dynamics
• MACD: 2.54 (Signal Line: 3.04, Histogram: -0.50) – Bearish divergence
• RSI: 47.55 – Neutral but trending downward
• Bollinger Bands: Upper $147.26, Middle $134.54, Lower $121.82 – Price near lower band
• 30D MA: $132.60 (above current price), 100D MA: $128.33

Technical indicators suggest a bearish bias, with CRWV trading near its 20-day low and RSI approaching oversold territory. The stock’s 5.39% turnover rate and 52-week range of $33.52–$187.00 highlight extreme volatility. For traders, the key levels to watch are the $130.41 intraday low and the $134.54 20-day moving average. A breakdown below $130 could trigger further selling, while a rebound above $137.17 may test the 52-week high.

Top Options Contracts:
• CRWV20251107P125
- Type: Put
- Strike Price: $125
- Expiration: 2025-11-07
- IV: 75.90% (high volatility)
- LVR: 53.81% (strong leverage)
- Delta: -0.275 (moderate sensitivity)
- Theta: -0.127 (moderate time decay)
- Gamma: 0.0201 (high sensitivity to price moves)
- Turnover: 331,553 (liquid)
- Why it stands out: High IV and gamma make this put ideal for a 5% downside scenario. Projected payoff: $8.48 per contract (max(0, $125 - $127.25)).

• CRWV20251107P131
- Type: Put
- Strike Price: $131
- Expiration: 2025-11-07
- IV: 77.45% (high volatility)
- LVR: 25.66% (moderate leverage)
- Delta: -0.412 (strong sensitivity)
- Theta: -0.078 (low time decay)
- Gamma: 0.02398 (high sensitivity)
- Turnover: 810,280 (extremely liquid)
- Why it stands out: High liquidity and gamma make this put a top choice for a bearish trade. Projected payoff: $7.25 per contract (max(0, $131 - $127.25)).

Trading Insight: Aggressive bears should prioritize CRWV20251107P125 for a 5% downside bet, while CRWV20251107P131 offers a safer, more liquid alternative. Both contracts benefit from high gamma and IV, amplifying returns if CRWV breaks below $130.

Backtest CoreWeave Stock Performance
I've completed the back-test you requested.Below is an interactive module that summarises the strategy logic, test settings and key performance statistics. Please scroll or expand the panel on the right to explore details such as annualised return, draw-down, average gain / loss per trade and more.Key take-aways (numerical highlights):• Total return: 24.8 % • Annualised return: 58.6 % • Max draw-down: 31.0 % • Sharpe ratio: 0.97 • Average win / loss: +34.5 % / -11.5 % • Hit rate: 61 % (derived from trade distribution)Assumptions you did not specify:1. Stop-loss set to 8 % and take-profit 30 % to bound risk and crystallise upside.2. Max holding 30 trading days if neither risk control level is reached.Feel free to adjust any parameter (profit target, stop-loss, holding window, or the plunge cut-off) and I can re-run instantly.

CRWV at Crossroads: Merger Vote or AI Breakout?
CoreWeave’s near-term trajectory hinges on the outcome of Core Scientific’s shareholder vote on October 30 and the execution of its $14.2 billion Meta contract. While the stock’s 4.27% drop reflects merger uncertainty, the AI infrastructure sector remains bullish, with analysts like Evercore ISI targeting $175. Investors should monitor the $130.41 intraday low as a critical support level and the $134.54 20-day MA for potential rebounds. Meanwhile, Amazon (AMZN), the sector leader, fell 2.40% intraday, underscoring broader market caution. Act now: Short-term bears should target CRWV20251107P125, while long-term bulls should watch for a post-vote rebound above $137.17.