CoreWeave Plummets 5.8% Amid Legal Scrutiny and AI Sector Woes

Summary
• CoreWeave (CRWV) trades at $83.05, down 5.8% from its $88.16 close
• Intraday range spans $81.10 to $83.56 amid heavy turnover of 6.04M shares
• Pomerantz Law Firm investigates CoreWeave for potential securities fraud
• Nvidia’s $2.7B AI portfolio tanking, with CRWV down 46% from Q2 levels
CoreWeave’s sharp selloff reflects a perfect storm of legal uncertainty, revised guidance, and sector-wide AI fatigue. The stock’s 5.8% drop—its worst intraday performance since November—coincides with a class-action investigation and broader market skepticism toward AI infrastructure plays.

Legal Scrutiny and Guidance Cut Trigger Sharp Selloff
CoreWeave’s collapse stems from twin catalysts: a class-action investigation by Pomerantz LLP and the company’s revised 2025 guidance. On November 10, CoreWeave slashed capital spending and revenue forecasts, citing data center capacity constraints. This followed a 16.31% single-day drop on November 11 after the announcement. The Pomerantz probe, triggered by insider selling and alleged misrepresentations, has amplified investor anxiety. Meanwhile, Nvidia’s $2.7B AI portfolio—where CRWV constitutes 91%—has cratered 30% since Q3, reflecting a broader reassessment of AI infrastructure valuations.

Options Playbook: Capitalizing on Volatility with CRWV Puts
• Kline pattern: Short-term bullish trend (contrary to recent action)
• MACD: -5.21 (bearish divergence), Signal Line: -8.75
• RSI: 65.47 (neutral, but oversold near 60)
• Bollinger Bands: Price at $83.05 (near lower band at $65.58)
• 200D MA: Data missing, but 30D MA at $91.24 (price 10% below)
Key levels to watch: 74.87 (30D support) and 76.28 (resistance). Short-term bearish momentum suggests a test of the $76–$77.5 strike range. Two options stand out for bearish exposure:

CRWV20251219P77.5
• Put Option: Strike $77.5, Expiry 12/19
• IV: 82.35% (high volatility)
• Leverage Ratio: 36.58% (moderate)
• Delta: -0.3077 (moderate sensitivity)
• Theta: -0.0810 (rapid time decay)
• Gamma: 0.0332 (responsive to price swings)
• Turnover: 128,040 (high liquidity)
Payoff at 5% downside ($78.8975): $8.6025 per share. This contract balances volatility and liquidity, ideal for a 5–7 day bearish trade.

CRWV20251219P80
• Put Option: Strike $80, Expiry 12/19
• IV: 83.49% (high)
• Leverage Ratio: 24.83% (moderate)
• Delta: -0.3994 (strong sensitivity)
• Theta: -0.0651 (moderate decay)
• Gamma: 0.0359 (high responsiveness)
• Turnover: 386,262 (exceptional liquidity)
Payoff at 5% downside: $11.1025 per share. This contract offers higher leverage with robust gamma, making it a top pick for aggressive short-term bearish bets.

Action: Aggressive bears should prioritize CRWV20251219P80 for its high gamma and liquidity. Conservative traders may cap risk with a stop above $83.56 (intraday high).

Backtest CoreWeave Stock Performance
The iShares Core S&P U.S. ETF (CRWV) has demonstrated resilience following a -6% intraday plunge from 2022 to the present. The backtest reveals a 3-day win rate of 56.18%, a 10-day win rate of 55.06%, and a 30-day win rate of 53.93%, indicating a higher probability of positive returns in the short term. The average 3-day return is 3.06%, the 10-day return is 4.15%, and the 30-day return is 16.58%, suggesting that CRWV tends to recover and even exceed its pre-plunge levels in the medium to long term.

Act Now: CoreWeave's Legal Clouds and Sector Shifts Demand Vigilance
CoreWeave’s selloff is far from over. With legal uncertainty and sector-wide AI fatigue weighing, the stock faces near-term support at $76–$77.5. Investors should monitor the Pomerantz investigation and CoreWeave’s data center capacity updates. Meanwhile, Microsoft (MSFT), the IT Services sector leader, rose 0.12% today, underscoring the sector’s mixed dynamics. For CRWV, a breakdown below $76.28 could trigger a retest of the 52W low at $33.52. Watch for $76.28 breakdown or regulatory updates—either could redefine the stock’s trajectory.