Erayak Power (RAYA) Plummets 32.9%: Regulatory Warnings and Market Volatility Collide

Summary
• Erayak Power (RAYA) slumps 32.9% to $0.0477, its lowest since 2023
• Nasdaq delisting notice and reverse stock split plans trigger panic
• $7M funding round in August fails to stabilize investor sentiment
• Sector peers like Enphase Energy (ENPH) also under pressure

Erayak Power’s stock has imploded amid a perfect storm of regulatory threats, governance changes, and weak market fundamentals. The company’s announcement of a 220-for-1 reverse stock split and Nasdaq delisting risk has sent shares into freefall, with intraday trading between $0.045 and $0.0537. This collapse reflects deepening concerns over liquidity, corporate governance, and the company’s ability to meet listing requirements.

Regulatory Delisting Threat and Reverse Stock Split Spark Sharp Selloff
Erayak Power’s 32.9% intraday drop stems from a Nasdaq delisting notice issued on September 3, 2025, citing failure to maintain a $1 minimum bid price. The company’s shares have traded below $0.10 for 10 consecutive days, triggering immediate delisting proceedings. To comply, Erayak announced a 220-for-1 reverse stock split effective September 30, 2025, which will reduce outstanding shares from 187.9 million to ~854,059. This aggressive restructuring signals desperation to avoid delisting but raises red flags about underlying financial health. Recent $7M and $3M equity offerings in August failed to restore investor confidence, as the stock remains 96% below its 52-week high of $3.35.

Electrical Equipment & Parts Sector Under Pressure as Enphase Energy (ENPH) Leads Decline
The Electrical Equipment & Parts sector is broadly weak, with Enphase Energy (ENPH) down 2.92% as of 19:13 ET. RAYA’s collapse mirrors broader industry struggles, including margin pressures and regulatory scrutiny. However, RAYA’s situation is uniquely dire due to its delisting risk and governance overhaul. Sector peers like Eos Energy (EOSE) and Plug Power (PLUG) have fared better, with EOSE down 0.56% and PLUG down 2.49%. RAYA’s 32.9% drop far outpaces sector averages, highlighting its precarious position.

Bearish Technicals and Options Playbook: Short-Term Hedging and Positioning
• MACD: -0.0626 (bearish divergence from signal line -0.0945)
• RSI: 67.67 (overbought but bearish reversal expected)
• Bollinger Bands: Price at $0.04938 (middle band), below upper band $0.0690
• 200D MA: $1.19 (far above current price)
• Support/Resistance: 30D support at $0.0477, 200D resistance at $1.25

RAYA’s technicals confirm a bearish breakdown. The stock is trading below all major moving averages, with RSI near overbought territory but failing to close above the 70 threshold, suggesting exhaustion. Bollinger Bands show extreme compression, indicating high volatility ahead. Short-term traders should target key support levels at $0.045 (intraday low) and $0.0345 (52-week low).

Options Analysis:
• RAYA20251001P0050 (Put, $0.05 strike, Oct 1 expiry): IV 65%, Delta -0.45, Theta 0.03, Gamma 0.012, Turnover $120k. This put offers 50% leverage with moderate delta, ideal for hedging a 5% downside scenario. Projected payoff: $0.0047 (47% gain if price drops to $0.045).
• RAYA20251001C0050 (Call, $0.05 strike, Oct 1 expiry): IV 60%, Delta 0.38, Theta 0.028, Gamma 0.011, Turnover $95k. A speculative call for a rebound, but high IV and low delta make it risky. Projected payoff: $0.0023 (46% gain if price rallies to $0.055).

Action: Aggressive short-sellers may target RAYA20251001P0050 for a 47% gain if the stock breaks below $0.045. Long-term investors should avoid RAYA until the reverse split and delisting risks are resolved.

Backtest Erayak Power Stock Performance
I reviewed all intraday data for RAYA.O from 2022-01-01 through today (2025-09-25). No trading day during this period experienced an intraday decline of 33 % or more, so the event list needed for the back-test is empty.Because there are no qualifying events, an event-driven back-test (measuring post-plunge performance) cannot be run at the moment.Would you like to:1. Lower the plunge threshold (e.g., −25 %, −20 %), 2. Use daily close-to-close drops instead of intraday extremes, or 3. Analyze a different ticker / time span?Let me know how you’d like to proceed, and I’ll set up the back-test accordingly.

Act Now: RAYA Faces Critical Support Test as Delisting Clock Ticks
Erayak Power’s 32.9% drop reflects a confluence of regulatory, financial, and technical headwinds. The stock’s breakdown below $0.045 and 52-week low of $0.0345 could accelerate its delisting. Short-term traders should monitor the $0.045 level for a potential 47% gain on the RAYA20251001P0050 put. Meanwhile, the sector leader Enphase Energy (ENPH) is down 2.92%, signaling broader weakness. Investors must act decisively: either hedge with puts or exit long positions before the reverse split and delisting hearing on September 10. The clock is ticking for RAYA—watch for a final breakdown or regulatory intervention.