Rocket Lab Shares Plummet 8.46% as Death Cross and Oversold RSI Signal Bearish Momentum

Rocket Lab (RKLB) experienced a significant 8.46% decline in the most recent trading session, closing at $70.65. This sharp drop, coupled with elevated volume ($1.65 billion), suggests a potential exhaustion of bullish momentum or a shift in market sentiment. Below is the technical analysis across key frameworks.
Candlestick Theory
. The recent session’s bearish candlestick, marked by a long lower wick and a decisive close near the session low, aligns with a shooting star pattern, signaling short-term bearish bias. Key support levels emerge at $70.65 (recent close) and $61.49 (December 12 low), while resistance clusters near $77.18 (December 23 high). A breakdown below $70.65 could trigger a retest of the $61.49 support, with potential for further downward extension.
Moving Average Theory
The 50-day, 100-day, and 200-day moving averages (calculated from historical data) indicate a bearish alignment, with the 50-day MA crossing below the 200-day MA (a “death cross” signal). Short-term momentum remains negative, as the price is trading below all three MAs. A sustained break above $77.55 (December 22 high) could trigger a retest of the 50-day MA as a potential short-term support-turned-resistance.
MACD & KDJ Indicators
The MACD histogram has turned negative, with the MACD line crossing below the signal line, reinforcing bearish momentum. The KDJ stochastic oscillator (using 14-period settings) shows %K and %D converging near oversold territory (<30), suggesting potential for a short-term bounce. However, a divergence between rising %K and falling price may indicate waning bearish conviction, warranting caution.
Bollinger Bands
Volatility has expanded, with the recent close near the lower Bollinger Band ($69.00–$72.30 range). This suggests oversold conditions, though a break below the band could signal a continuation of the downtrend. The band’s widening reflects increased uncertainty, with potential for a mean reversion or a breakout depending on follow-through volume.
Volume-Price Relationship
The recent session’s volume spiked to 22.9 million shares, validating the price drop as a high-conviction move. However, declining volume on subsequent days (e.g., 16.7 million on December 24) may indicate diminishing bearish pressure. A divergence between price and volume could foreshadow a reversal, though current alignment supports continuation of the downtrend.
Relative Strength Index (RSI)
. The 14-period RSI stands near 28, entering oversold territory. While this typically suggests a potential rebound, the RSI’s failure to close above 30 in prior sessions indicates a strong bearish bias. A closing above 35–40 would be critical for a reversal signal, while a break below 25 could extend the decline toward the next Fibonacci level.
Fibonacci Retracement
Applying Fibonacci retracement between the December 22 high ($77.55) and the December 19 low ($60.75), key levels include 38.2% ($70.45) and 50% ($69.15). The current close near $70.65 suggests a potential test of the 38.2% level as a near-term support. A breakdown below $69.15 could target the 61.8% level ($65.45) as the next critical threshold.
Confluence of bearish signals (MACD, MAs, and candlestick patterns) suggests a high probability of continued downside, with $61.49 as a near-term key support. However, oversold RSI and KDJ readings hint at possible short-term bounces, though these may lack sustainability without a clear reversal in volume and momentum. Divergences between stochastic oscillators and price action warrant close monitoring for early reversal cues.